BMW: i3 Electric Vehicle by Jeremy Pomp

BMW: i3 Electric Vehicle The Intersection of Policy, Business, & Carbon Lauren Blasch, Jeremy Pomp, Marla Stancil, Shyam Vijayaraghavan January 24, 2011

Science and Society Slakey and Clay January 24, 2011

In December of 2010, Nissan had begun delivering its Leaf, the first mass-marketed 100% electric car, to buyers (Figure 1). General Motors had just reemerged from bankruptcy and simultaneously began selling the Chevrolet Volt, which was named 2011 “Green Car of the Year” (Figure 2). Robert Cradle, BMW’s Washington, DC representative, looked out the window of his Washington, DC office and contemplated what the automotive market could look like over the next two years, during which time BMW would introduce its first all electric car: the i3. It was the first time that BMW had designed an electric car from the ground up. The vehicle had seating for four adults, 12 cubic feet of cargo space, used mass amounts of carbon fiber to reduce weight, and was 100% powered by a lithium-ion battery pack. Foremost in Mr. Cradle’s mind was the role that United States governmental policy would have in the success or failure of the I3 vehicle and, by extension, electric cars in general. Would the EPA attribute so-called “upstream emissions” to the electricity needed for electric cars even though they had never done so for the gasoline refining process in traditional internal combustion automobiles? Would this decision encourage strong sales for the I3? What miles per gallon (MPG) rating would the vehicle be given since it does not use liquid fuel? How would that rating affect BMW’s adherence to the Corporate Average Fuel Economy (CAFE) standards, established by the National Highway Traffic Safety Administration (NHTSA), which reflected the weighted average fuel economy, expressed in miles per gallon, of a manufacturer’s fleet of passenger cars and trucks? Would American consumers value this type of vehicle (Figure 3)? It was clear to Mr. Cradle that the impact and viability of the electric car in America would be heavily influenced by government policies. When elected in 2008, President Obama had made clear that he wanted 1 million electric cars on the road by 2015. However, during the mid-term elections in November of 2010, the Democratic Party had lost its majority position in Congress and it seemed that the political tides were shifting. There was also a corresponding rise in BMW: I3 Vehicle

consumer doubts regarding the existence of climate change. Furthermore, Cradle was aware of a report comparing the well to wheel emissions per mile for EVs and Hybrids; the results were sobering, demonstrating that electric vehicles were a premature technology. Looking forward to his pending meeting with the Auto Alliance (an automotive trade organization), Mr. Cradle outlined the policies that would best aid the success of the forthcoming BMW I3 vehicle.

Electric Cars in the United States The first electric vehicle (EV) appeared in 1828, with related technology steadily improving throughout the 1800s. Early electric vehicles were predominantly rail-reliant, and pioneered the electrification of trains and underground travel. The first electric car that fits the modern definition was developed in the early 1890s. In 1897 New York City purchased a fleet of electric cars for use as taxis and installed public charging stations in downtown shopping districts.i At the time, EVs were popular with wealthy female consumers who preferred a quiet and reliable vehicle that did not require a hand-crank to physically start the engine. In the U.S., electric vehicles outnumbered gasoline vehicles at the turn of the century; however, gasoline vehicles soon prevailed for a number of reasons. Inter-city infrastructure improved, giving advantage to gasoline vehicles due to their greater drivable range and speed. Petroleum was discovered in Texas, thus lowering the cost of ownership. Furthermore, electric starters replaced hand cranks, and mufflers were introduced to decrease noise and soot. Finally, Ford began mass-producing gasoline automobiles at prices affordable for the middle class, whereas previous gasoline vehicles were only affordable for the wealthy. Thereafter, electric vehicles became largely irrelevant outside of the occasional niche or concept vehicle, such as the lunar rover (the battery powered vehicle used on the moon).ii

During the 1990â&#x20AC;&#x2122;s the California Air and Resource Board (CARB), developed legislation pushing automakers to produce â&#x20AC;&#x153;zero-emissionsâ&#x20AC;? vehicles. As a result, GM, Ford, Toyota, and BMW: I3 Vehicle

others began development of EVs in order to comply with the law. However, once the restriction was overturned, automakers quickly shut down their EV production.iii U.S. interest in EVs began to build once again in the mid 2000s when global warming and climate change were at the forefront of consumers’ minds. In 2008 spot oil hit its all-time peak price; consumers throughout the United States were paying anywhere from $3.50 - $5.50 per gallon of gasoline, and for the first time in history, they actually drove less than they had in the previous year.iv As a result, consumers began shopping for alternatives to larger vehicles and demand increased for high MPG vehicles, such as the Toyota Prius (Figure 4).

External Factors Government Policies From a policy perspective, upstream emissions stemming from the refinement of gasoline or the manufacturing of a car were never included in the vehicle’s miles per gallon. Moving forward, regulators did not see the need to include the upstream emissions (from the battery charging) of EV’s in the estimate of its miles per gallon equivalent (MGPe). There were more significant energy losses in the charging of a battery than there were in the refinement of oil into gasoline, which averaged at only 15%.v In the EPA’s most recent MPGe sticker for EVs, 0 emissions were attributed, indicating a policy to ignore the upstream emissions from electricity production. Some policy makers seemed to acknowledge that electric vehicles (because most electricity is currently produced from coal) may not be “cleaner” than some of the more efficient cars on the market currently when conducting a well to wheels analysis, however, it was clear that many supported the policy proposals on the basis that it benefited the U.S. manufacturing sector and the struggling American automotive market.

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The 2009 Car Allowance Rebate System (CARS), colloquially known as “Cash for Clunkers”, stimulated sales for the auto industry to the tune of 690,000 vehicles by providing thousands of dollars in rebates to consumers for trading in their old inefficient vehicles for new, more efficient vehicles. In 2009, the American Clean Energy and Security Act passed in the House of Representatives but not in the Senate. Thus, a cap and trade market for carbon emissions was not created in the United States. As part of the proposed bill, subsidies would have been given for energy efficient vehicles, such as electric vehicles.

Corporate Average Fuel Economy (CAFE) Standards were first implemented in 1975 in response to the 1973 Fuel Embargo. CAFE standards mandated that each manufacturer be held to a weighted average of its fleet’s fuel economy. Given greater authority on the basis of a Supreme Court ruling in 2007, the EPA’s power was bolstered and it began to raise national MPG standards. The EPA set new standards for automobile manufacturers for 2016: the fleet-wide gas mileage for a manufacturer of cars was increased to 35 MPG for all total light vehicles with the distinction between MPG standards for cars and for trucks removed. Manufacturers not meeting these standards had been and would continue to be penalized with fines for not meeting the standardsvi.

The Energy Policy Act of 2005 created a tax credit of up to $3,400 for purchasing a hybrid. This applied to the first 60,000 hybrid vehicles per carmaker, with the credit slowly phasing out thereafter. Furthermore, the tax credit was also adjusted for each hybrid’s efficiency gains. This program was seen as a key catalyst for kick starting hybrid sales. Similarly, with EVs commanding a price premium due to their expensive batteries, incentives would be needed to drive EV adoption.vii The Energy Improvement and Extension Act of 2008 and the America Clean Energy and Security Act of 2009 established federal tax credits of $2500 plus $417 for each KWh of battery BMW: I3 Vehicle

capacity, with a maximum total credit of $7500. Several states have also followed suit and instituted additional tax credits or incentives. At the time of this case, it is too early to tell the results of this policy measure.

Economic At its all-time high, US automobile sales reached over 16 million in 2007. Globally, over 54,920,317 automobiles were produced; a number never again reached (at the time of this case).viii Declining production and sales were accurate indicators of the economic climate amid the “great recession”. From roughly 2008 to 2010, a significantly tightened credit market negatively affected the leverage of Fortune 500 companies, individual credit cardholders, and small loan borrowers alike.ix This tightening of credit had a doubly crippling effect on auto manufacturers, which further compounded the aforementioned impacts.x First, automobile consumers no longer had access to affordable financing for the purchase of vehicles. Second, large automakers could no longer afford the credit they needed to keep their capital-intensive operations afloat. The combination of these two factors severely damaged the industry, as exhibited by sharply declining sales – in 2009 the U.S. market purchased just 10.4 million vehicles, almost 700,000 of which were “cash for clunker”1 sales.xi There was some industry optimism due to 2010 projections that predicted an increase by approximately one million domestic sales by the close of the year. Globally, China had taken the lead via a government stimulus package and, in 2009, for the first time in history, sold more cars than the United States. Chinese sales projections for 2010 were estimated to be around 14 million vehicles, with aggressive growth forecasting for following years. On the manufacturing 1

The “Car Allowance Rebate System” aka “Cash for Clunkers” was a US government initiative meant to incentivize drivers to relinquish their low mileage vehicles for more efficient ones. BMW: I3 Vehicle

side, budget friendly manufacturers reaped the benefits of their competitive pricing models as Korean firms Kia and Hyundai began absorbing market share from Japanese companies.xii

Environmental and Social Caught in a tired “industry versus environment” debate, the automotive innovators found themselves at a major crossroads. International efforts to curb carbon dioxide, the largest anthropogenic contributor to climate change, served as a wagging finger in the face of the automotive industry. Complicated by recently weakened demand and an undefined “green consumer”, the case for an electric vehicle was not as clear for automakers as its proponents might have suggested. Despite its relative ambiguity, the “green” movement was certainly in full swing. A distinct lack of cohesion regarding the definition of sustainability, particularly regarding its standardization within the private sector, added an aspect of chance to such initiatives. Still, like many new consumer behaviors, buying “green” had clearly infiltrated the upper echelon of purchasers and had begun to enter the main stream. This behavior reflected two components: first, that consumers were beginning to understand the gravity of the environmental dangers society was facing, and factored this into their purchases; second, that “green” products were desirable to the most wealthy consumers, thus indicating a certain level of exclusivity of such goods.xiii

Technological New battery technology had a much lower energy density compared to traditional combustible fuels. As such, battery improvements (beyond already realized gains from NiMh to Li-Ion technology) along with ancillary components, such as charging stations and smart grid technology, were seen as critical components to the EVs’ ability to reach the masses. Innovations, such as programmable chargers and charging infrastructure, throughout cities could effectively increase the range of EV travel, one of the seemingly most important detractors from BMW: I3 Vehicle

the consumerâ&#x20AC;&#x2122;s perspective on purchase. Additionally, vehicle manufacturers were investigating additional efficiencies that could be gained through the use of alternative materials in vehicle construction and production to increase the attractiveness of EVs to the public. The I3 Vehicle, one of the most ambitious vehicles in this arena, was the first automobile in history to extensively use carbon fiber reinforced polymers (CFRP) in a mass-produced vehicle; the passenger cell and other items, such as the bumper reinforcement bar, were all slated to be carbon-fiber. Because of its relatively limited use in mass production previously, the learning curve for carbon fiber was still in its earliest stages. The material itself was promising due to being significantly stronger and much lighter than steel. Therefore, it was of particular interest to electric vehicle manufacturers seeking to offset the weight of heavy batteriesxiv.

BMW History Bayerische Motoren Werke (BMW), meaning Bavarian Motor Company, is a luxury automobile and motorcycle manufacturing company that was founded in Germany in 1916. While the company did not operate under the name of BMW until 1917, it considers the founding date of Bayerische Flugzeug-Werke (BFW), a company that BMW acquired in 1922, as its own. Originally, BMW primarily produced aircraft engines. The circular blue and white logo that BMW still has today is meant to replicate the movement of propellers on an aircraft. The production of aircraft engines was a successful endeavor as there were significant government subsidies provided as a result of WWII. Towards the end of the war, however, BMWâ&#x20AC;&#x2122;s plants had sustained significant damage and the company was struggling financially. It was not until 1948 that BMW rejuvenated its product line, focusing on automobiles and motorcycles. BMW: I3 Vehicle

The reign of Eberhard von Kuenheim as BMW’s Chairman of the Board began in 1970 and resulted in the company’s shift from a national powerhouse to a global brand. Under von Kuenheim’s leadership, which did not cease until 1993, BMW continued to expand, with a strategic plant placement within the United States. Further, the company purchased Rover Group, the owner of the Land Rover and Mini brand, and acquired Rolls-Royce. In an effort to refine its brand and target customer base, BMW sold the Rover Group in 2000 but retained its ownership of the Mini brand. At the time of the case, BMW’s product lines fell within the BMW, Mini and Rolls-Royce brands and were targeted to the premium automobile segment, on an international scale. Further, BMW was the largest maker of luxury cars in the worldxv.

BMW Electric Vehicle Target Market In focusing to compete with only the BMW, Rolls-Royce and Mini brands, BMW recommitted to focusing on the premium market. Additionally, its role as the sustainability leader within the automobile industry made the brand attractive to drivers desiring leading technology, high performance and environmental responsibility. At the time of the case, the company’s core strategy stated that the “BMW Group is the leading provider of premium products and premium services for individual mobility”xvi . The target market for the electric vehicle was predominately in line with the company’s overall customer profile: a luxury vehicle purchaser that places an emphasis on maximum performance and advanced technology. The electric vehicle target customer was also concerned with being seen as environmentally responsible and, in the case of the I3 Vehicle, was an urban dweller. BMW envisioned the I3 Vehicle to be a second automobile for the luxury, urban driver.xvii

BMW as a Sustainability Leader At the time of the case, BMW firmly believed that it was the automobile industry’s leader in sustainability and, as such, crafted a strategy known as “Number One”. The strategy detailed the company’s “commitment to profitability, sustainable value creation and safeguarding [BMW’s] independence” with an aim to develop “new profitable business lines across the entire BMW: I3 Vehicle

automobile life-cycle and value chain” while resolving to invest substantially in “technologies of the future, new vehicle concepts, and pioneering drive systems”xviii . The “Number One” strategy placed particular emphasis on climate and demographic trends. Prior to the “Number One” strategy rollout, in 2004, BMW introduced the concept of EfficientDynamics, which underpinned the company’s goal of producing automobiles with maximum performance while preserving the environment through reduced fuel use and emission creationxix . BMW was not alone in asserting its place within the industry as, at the time, the Dow Jones Sustainability Index recognized BMW as the sustainability leader of the automobiles and parts sector.xx BMW’s strategies and investment plans for future growth hinged upon a commitment to pioneering technologies that would further advance its role as a sustainability innovator within the automobile industryxxi. BMW’s e-mobility strategy was directly in line with its focus upon the marriage of performance and sustainability. BMW firmly believed that by creating electric vehicles, it produced a vehicle that utilized energy from renewable sources, thus rendering the vehicle climate-neutral. BMW saw its future through a lens of advanced technology, sustainability and innovationxxii . Accordingly, the company’s mantra of innovation, at the time of the case, was “we set future standards today”xxiii.

The Evolution of the I3 Vehicle

BMW first began exploring the potential for electric vehicle production in 1969, with the introduction of its first electric vehicle: the 1602 sedan. The 1602 was propelled by a 32kilowatt, 144-volt electric motor and lead acid batteries and had a total of 42 horsepower. A small fleet of these orange painted vehicles was used as support vehicles in the 1972 Olympics held in Munich, Germany. BMW then followed up on its initial entry into the electric vehicle market with its first dedicated BMW: I3 Vehicle

all-electric vehicle model, the E1, in 1993. The goal of the E1 project was to gain additional insight on the advantages and disadvantages of electric vehicle use for daily, practical driving. Constructed using aluminum and plastic panels, the lightweight vehicle weighed less than 2,000 pounds and had a range of 80 miles. The E1 vehicle laid the foundation for what would become BMW’s holistic approach to electro-mobility and provided insights to future electric vehicle specific designs. However, current battery technology during the time of production stymied further electric vehicle developmentxxiv .

Project i The advent of the lithium-ion battery and its subsequent proven ability in a variety of applications in the late 2000s led BMW to further explore electric vehicle technology. By late2007 BMW launched “project i” with a long-term goal of bringing “fresh thinking to the company’s technologies, processes and vehicle concepts, whether in production, development or sales” and a mission to “develop new, pioneering products geared closely to future challenges and customer requirements in the field of urban mobility”. The project had no constraints or preconceptions, was unconventional and took independent approaches. Further, the project i team enjoyed transparent knowledge sharing and had the full support of experts within the entire company. Peter Ratz, head of project i, stated: It’s a great experience for me to be able to work in a project like this, with colleagues who are all on a similar wavelength. From the start, we were given every freedom we needed. The result was a mood, an atmosphere you would normally only encounter in a start-up company.xxv In the spring of 2008, during the Project i team’s first venture, BMW manufactured 600 electrically driven Mini Cooper vehicles, known as the MINI E. BMW then leased the vehicles to consumers in the United States and Germany as a way to gain additional consumer research on the use and viability of electric vehicles. The successful results of this project led BMW to conclude that electric mobility was suitable for everyday use. Leasees were pleased with the vehicle’s range, found it fun to drive, and reliable, but concluded that it needed greater cargo BMW: I3 Vehicle

capacity and additional seating. Consumers found that charging the vehicle at home was convenient and rarely did they need to recharge anywhere but at home. A third of the users clocked up a higher mileage with the MINI E than the vehicle it replaced as a result of its enjoyable drivexxvi (Figure 5).

The I3 Vehicle (MCV) It quickly became clear that the Project i team would focus on creating a zero emissions vehicle for the urban mobility market. Thus, the I3 Vehicle (MCV) concept was born. A â&#x20AC;&#x153;i3â&#x20AC;? was defined as an urban metro area with a population in excess of 10 million. BMW planned to introduce its I3 vehicle in these specific global urban markets, which, by definition, would include only Los Angeles and New York, in the United States. Considering the projected price tag, in excess of $40,000.00, and the high development costs it seemed likely that BMW would consider other non-megacities in the U.S., such as Washington, DC, Boston, and Miami. This approach, which was similar to the one taken by Nissan and Chevrolet (when releasing the Leaf and Volt), would be taken in order to reach a broader sales base, given that the United States is the second largest automobile market in the world. Additionally, the higher price tag was meant to be affordable to wealthy customers, particularly those looking for a second, nonprimary vehicle. It is worth noting that a key component of adoption of EVs was the availability of charging stations. In the U.S., consumers in suburban markets had greater access to charging stations compared to urban consumers, because of the ability to charge the vehicle at their residence. A statement by a major automobile company CEO claimed that 70% of consumers would do most of their EV charging at home. The MCV would be designed from the ground up as an electric vehicle. Further, the MCV would be built with a completely new vehicle architecture design and would address the few concerns that MINI E customers vocalized. The MCV was slated for sale in 2013 and would be represented under a new, BMW i sub-brand. The goal of the MCV was not only to create the

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most eco-friendly vehicle but also to address the sustainability of the vehicle throughout its lifecycle, from cradle to grave. Cradle to grave meant claiming full-scale manufacturing accountability, starting with the production process and ending with the recycling or reuse of all vehicle components at the MCV’s end of life. In essence, BMW sought to record and analyze the sustainability of its entire value chain. A radically conceived vehicle, the MCV would be built from scratch and emphasize BMW’s new EV’s “LifeDrive” concept of incorporating two distinct units of the vehicle, the secure and solid body structure made of CFRP and the electric motor and battery components (Figure 6). The electric motor provides 125kilowatt/170 horsepower and had been designed in-house by BMW, while the battery was supplied by SB Limotive (a joint venture between Samsung and Bosch)xxvii . Klaus Draeger, a member of BMW’s Board of Management for Development, stated: The I3 Vehicle is a revolutionary automobile. It will be the world's first volume-produced vehicle with a passenger cell made from carbon. Our LifeDrive architecture is helping us to open a new chapter in automotive lightweight designxxviii . At the time of the case, raw carbon fiber threads produced at a newly constructed U.S. based plant in Moses Lake, Washington. The plant, a joint venture between BMW and SGL Automotive Carbon Fibers, ran off of hydropower. The carbon fiber material would then be transported via ship to Wackersdorf, Germany, where it would be woven into pre-formed carbon fabric. Next, it was shipped to Landshut, Germany, where the carbon fabric was used to build the main automotive components of the car. During this phase, the material was transformed into panels by a quasi-stamping process and formed using a dyed resin, thus removing the painting process altogether. Finally, the MCV components were to be shipped to BMW’s manufacturing plant in East Germany, near the town of Leipzig, for final assemblyxxix .

The Case for Hybrids The complexities of accounting for electric vehicle emissions left room for debate among other

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interested parties. Exxon had done extensive research on the societal and environmental implications of the car, and developed an internal report, which summarized the company’s conclusions. Namely, existing technologies’ benefits had not been fully realized, rendering the electric vehicle a premature addition to the market. Exxon drew a thick line between the electric vehicle, the plug-in hybrid electric vehicle, and the hybrid vehicle, and relayed their findings accordingly. In an internal presentation, David Stern, Senior Advanced Fuels Advisor, commented: Comparing the electric vehicle’s MPG to a traditional vehicle is apples to oranges. The information we have about light-weighting vehicles, particularly with the use of carbon fiber and similar materials, could realize significant fuel efficiency improvements for internal combustion engines (ICEs). In order to draw a fair comparison, we need to look at the weight of the vehicles rather than their MPGes alone. Large [and therefore heavy] ICE vehicles are a product of American consumer demand. If we lighten the weight of vehicles that Americans are already driving, we can see immediate fuel savings, without incurring unnecessary infrastructure and R&D costs.xxx Part of Stern’s argument was attributed to the infrastructure changes necessary for successful market penetration of the electric vehicle. Namely, consumer behavior changes, including: potential home installation costs (which Exxon had estimated to be between $900-$2,100); daily charging; off-peak charging to limit peak demand growth; and limited range. Smith’s presentation also cited societal costs, and the likely need for subsidies to supplement expensive batteries, commercial charging stations, and a lack of revenue due to a loss via the gasoline tax. With regard to carbon emissions, Exxon saw the electric vehicle as the weakest performer among comparables (PH-EV and Hybrid). Figure 7 shows a graphic explaining the emissions of each of the aforementioned vehicles, and includes EU versus U.S. passenger cars. Based on the energy necessary to charge the vehicles, compared to gasoline power to travel the same distance, the

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exhibit shows a distinct disadvantage for the electric vehicle, only slightly superior to an average U.S. ICE vehicle.

Conclusion Following a successful meeting with the Auto Alliance, Robert Cradle was confident that regulators at the EPA would recognize that in order for electric vehicles to be successful in the automobile market, they would have to be considered zero-emissions vehicles. After all, how could automakers be responsible for the upstream emissions on vehicles charged through the grid when most U.S. consumers didn’t have the option to choose their electricity provider? If upstream emissions were included as each vehicle’s emission, the project would be dead in the water. Ultimately the electricity for the electric vehicles had to come from somewhere and, in the U.S., it came predominately from power plants fueled by coal and natural gas. Therefore, in the short term, if one considers the upstream emissions needed to produce the electricity for the electric vehicle, it would appear that the electric vehicle emits more CO2 than a 2011 Toyota Prius. It would seem that short-term hybrid vehicles are better for the environment than electric vehicles (Figure 8). In late December of 2010, the EPA released its final environmental ratings for both the Nissan Leaf and the Chevrolet Volt. The EPA’s rating of these two vehicles would give BMW a clear indication of how the I3 Vehicle would be rated. The Leaf, being 100% electric, was given a perfect score for its Environmental Rating of “best” for the categories of “CO2 emissions” and “other air pollutants”. The Chevrolet Volt, due to its use of gasoline to charge the batteries when needed, was rated at 84 grams of CO2 per mile and given a score of 6 out of 10 (10 being the best) in the category of “other air pollutants” (Figure 9). It seemed that BMW’s I3 Vehicle would be given a perfect rating as well, based on the calculation of the Nissan Leaf. However, the question remained whether or not the public perception of electric vehicles’ environmental impact would hinge upon the EPA ruling. Would

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environmentalists continue to support the “green” electric vehicle if it were proven to be dirtier than some hybrid cars? Will the public be willing to accept the short-term environmental losses of electrifying the automobile in order to potentially address the long-term problem of greenhouse gases? Surely, BMW could market the I3 Vehicle as a “zero-emissions” vehicle because, technically, it is; however, should BMW also be held responsible for letting consumers know about upstream emissions? Finally, public and government support would be necessary for the investment needed to completely change over the current infrastructure to support EVs. Would the public continue to support the governments tax subsidies, loans, and other appropriations for the creation of this new infrastructure? The early hybrid market showed that incentives were required to jump-start sales. Was this a new market with several factors that lay outside of natural business control? Was the EV marketplace even viable without heavy tax incentives and other similar policy measures? Only time would tell whether or not the I3 and other electric vehicles would soon change the way people moved about. It was clear that this issue would be at the center of public policy and unprecedented business discussions for quite some time to come.

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EXHIBITS Figure 1: Projected Sales of Nissan Leaf (North America), eautopacific.com

Figure 2: Projected Sales of Chevrolet Volt (North America), eautopacific.com

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Figure 3: Competitive Landscape, eautopacific.com

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Figure 4: Past and Projected Sales of Toyota Prius (North America), eautopacific.com

Figure 5: Average Miles driven on a Daily Basis (US)

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Figure 6: BMW LifeDrive Logo

Figure 7: Exxon Data, sourced from MIT

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Figure 8: Hybrid Versus Electric

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Figure 9: EPA Stickers of Chevrolet Leaf and Nissan Volt

Leaf:

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Volt:

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Figure 10: I3 Versus Prius

Power-mix data for map from: http://www.getenergyactive.org/fuel/state.htm

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Figure 11: Projected Sales of Tesla Motors (models: Roadster & Model S) (North America), eautopacific.com

Figure 12: Total Light Vehicle Sales Forecast (North America), eautopacific.com

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Figure 13: Market Share (North America), eautopacific.com

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Figure 14: Historical Gas Prices, U.S. Department of Energy

Schiffer, Michael Brian. Taking Charge: The electric automobile in America. Washington: Smithsonian Institution Press, 1994. ii Schiffer, Michael Brian. Taking Charge: The electric automobile in America. Washington: Smithsonian Institution Press, 1994. iii Paine, Chris. Who Killed the Electric Car?, 1996. iv United States Department of Energy v Interview with Brett Yacobucci, December 14, 2010. vi http://en.wikipedia.org/wiki/Corporate_Average_Fuel_Economy BMW: I3 Vehicle

vii

http://www.kbb.com/car-news/all-the-latest/incentives-will-be-the-key-to-unlocking-future-evsales viii Worldometers. “Cars Produced this year”. 2010. Retrieved November 15, 2010: http://www.worldometers.info/cars/ ix Plunkett Research, LTD. “Automobile Industry Introduction”. 2010. Retrieved November 13, 2010: http://www.plunkettresearch.com/Industries/AutomobilesTrucks/AutomobileTrends/tabid/89/D efault.aspx x Burtless, Gary. Brookings. “The Credit Crisis and the Auto Industry”. 2010. Retrieved November 15, 2010: http://www.brookings.edu/multimedia/video/2008/1230_credit_burtless.aspx xi Plunkett Research, LTD. “Automobile Industry Introduction”. 2010. Retrieved November 13, 2010: http://www.plunkettresearch.com/Industries/AutomobilesTrucks/AutomobileTrends/tabid/89/D efault.aspx xii ibid xiii BMW. (2010). Innovation days. Munich, Germany: BMW xiv

Ibid www.bmwgroup.com xvi Ibid xvii Interview with “Robert Cradle” of BMW. November 3, 2010. xviii BMW. (2010). Innovation days. Munich, Germany: BMW xix www.bmwgroup.com xx Dow Jones. Sustainability Index. 2009. xxi Interview with Robert Cradle of BMW. November 3, 2010. xxii Ibid xxiii www.bmwgroup.com xxiv BMW. (2010). Innovation days. Munich, Germany: BMW xxv Ibid xxvi Ibid xxvii Ibid xxviii Ibid xxix Ibid xxx Interview with Exxon executives (paraphrased). November 15, 2010. xv

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