Renault has played down the importance of its supply agreement with EV charging infrastructure company Better Place as it has announced a new relationship with French construction company Bouygues.
IHS Automotive perspective | |
Significance | Renault has played down the importance of its supply agreement with EV charging infrastructure company Better Place as it has announced a new relationship with French construction company Bouygues. |
Implications | The relationship with Bouygues will be focused on several areas including the implementation of EV charging points in building projects, as well as the sustainability of these new constructions. |
Outlook | The new relationship with Bouygues perhaps highlights how ambitious Better Place's plans were and that recharging at destinations will remain core. |
French automaker Renault has downplayed the importance of its relationship with electric vehicle (EV) charging infrastructure company Better Place, which announced its bankruptcy this week (see United States – Israel: 27 May 2013: Better Place files for liquidation at Israeli court). The automaker's senior vice-president and chairman of its Asia-Pacific region Gilles Normand told Agence France-Presse (AFP) in a conference call, "In no way does this put in question our strategy concerning electric vehicles." He went on to say that the investment in the Quick Drop battery technology, which replaces discharged cells with fully charged units in special service stations, represented only a "very small part" of the EUR4.0 billion (USD5.17 billion) allocated by Renault-Nissan to its programme up to 2015. Normand was also quoted by Dow Jones Newswire as saying, "It's too early to say what the implications will be" of the liquidation decision, and that regarding asset writedowns, that will be something for Better Place's liquidator to determine. Nevertheless, he added that the company is "coordinating with [Better Place] to ensure that after-sales service continues, particularly in Israel," where it has its largest customer base. Normand also said that Renault retains the patents for the battery exchange system, and that the Chinese government had expressed interest in such a system.
Coinciding with Better Place's collapse, Renault has announced that it has signed a deal with construction company Bouygues which looks set to combine improving the ease of use of EVs with the increase in sustainable buildings. According to a statement released by the automaker, research and development (R&D) is taking place on several projects including the optimisation of recharging systems for EVs in car parks and the use of old EV batteries to improve the energy efficiency of buildings. The deal was sealed by chairman and chief executive officer (CEO) of Renault Carlos Ghosn having over a Renault Zoe EV to the chairman and CEO of Bouygues, Martin Bouygues.
Outlook and implications
Better Place was a project to offer EV drivers a swifter way of recharging such vehicles than using mains electricity, which takes at least 30 minutes on many vehicles even with a fast charger. The company had intended to have its "quick drop" stations in order for batteries to be swapped in as little time as it takes to refuel a more conventional gasoline (petrol) or diesel engine, making such technology more practical. However, while it had ambitious plans to enter a wide number of markets, the prospects for the business model had increasingly looked untenable, with the company having recently decided to narrow down its focus its efforts on building up the markets in Israel and Denmark where it already had a presence. Nevertheless, the customer uptake in these markets had fallen far behind its hopes, and its cash burn became been unsustainable with little opportunity to regain forward momentum.
Renault's involvement stems from it being a development partner in the project as well as it being the key supplier of vehicles in its Fluence Z.E. EV model. However, the number it has delivered is just a fraction of its overall EV sales. Nevertheless, despite its involvement, it had no stake in the business itself. It may also have been having its own doubts in the model recently, Normand having said that Renault had been approached recently about investing in the company, but decided that its role as a partner was to supply technology and vehicles.
The deal between Renault and Bouygues perhaps underlines that smaller steps are required in order to gain public acceptance of EVs. Certainly momentum is expected to grow in France according to the latest data, with passenger car registrations in the first four months of the year having more than doubled to 3,533 units, supported by incentives from the French government and a wider range of vehicles than ever before. With the installation of charging points in various building projects likely to encompass residential, working and public spaces in future, the increased ease of access should help further allay the anxieties of consumers of making the switch. However, the technology will remain limited in long distance applications, not helped by the failure of the Better Place model.