The Electric Car Is Dead All Over Again

The dream of an electric car that's both affordable and practical has eluded automakers, and will likely do so for another decade.

The problem is a lack of cheap, powerful battery technology that keeps ranges limited, charge times long, and prices high.

A much better battery is the "holy grail," says Jack Nerad, executive editorial director and market analyst at Kelley Blue Book. While lots of parties are working on it, "nobody's got there yet."

Until someone does, the story of the electric car in the United States will continue to be one of high expectations and consistent letdowns.

Fisker, a startup funded in part by nearly $200 million from the Department of Energy, just fired three quarters of its workforce and is in the process of imploding. It has not produced a single Atlantic, the model designed to be the "volume car that begins to build growth."

Tesla, another government-funded startup, has achieved profitability for this quarter (a major milestone), but despite unending promises that it will soon bring an affordable car to market, its prices have only gone up.

The company recently canceled plans to produce the cheapest version of its Model S sedan, and its least expensive version now starts at $62,400, with an EPA-rated range of 208 miles. The most expensive version of the sedan goes for $87,400, with a range of 265 miles. Those numbers are solid, but the price points put Tesla solidly in the realm of luxury brands.

The big automakers have gone in the other direction, opting for affordability over range. The $37,395 Honda Fit Electric, just going on sale now, promises a 123-mile range. Nissan's $28,800 Leaf gets between 75 and 84 miles. And the upcoming Chevy Spark EV will start at a very reasonable $25,000, with an unimpressive 60-mile range.

An affordable electric car does little good if it can't go more than 100 miles, while the more practical Model S is out of the reach of the middle class.

Either way, drivers who buy an electric car today are "paying a premium to be inconvenienced," Nerad told Business Insider.

And not many people are buying them. March marked the best month ever for EV sales in the U.S., according to the Electric Drive Transportation Association, but that grand total (for plug-in hybrid EVs and pure EVs) was a measly 7,632 vehicles. Combined, electric cars and hybrids make up just 3.77 percent of the American market share.

Things are unlikely to get better until the batteries that power electric cars become cheaper, more powerful, and faster to charge.

That new technology is "the most critical factor," said General Motors Manager of Electrification Communications Kevin Kelly.

To get there, GM has engineers "working around the clock," he said, and progress is "happening at a pretty rapid pace."

GM has talked a lot about the future of electric, but has not delivered so far. Sales of the Chevy Volt were behind those of the Leaf, its closest competitor, and even those of the much more expensive Tesla Model S.

Asked for a timeframe on the arrival of a truly mass market EV (shooting for a 250-mile range and a $30,000 price tag), Kelly suggested "in the intermediate term." Even once the battery technology is developed, it must be tested and produced.

Car product cycles take about 30 months, Kelly noted. In the auto industry, "intermediate" means more than five years, probably closer to ten.

"I think we will see better batteries" with quicker charging times, said Nerad. "Then electric cars become very very viable." But for now, he said, "nothing is imminent."

In the meantime, automakers will continue to rely on tax credits, high gas prices, and an enthusiastic base of eco-conscious drivers with cash on hand to buy their electric cars.

There are other ways to make their cars attractive: Tesla's new financing deal, announced last week to much fanfare, is really just a shortcut to lower prices, without real innovation.

Fiat found an interesting way to ease range anxiety for drivers of the 2013 500e, which goes just 87 miles on a charge. The purchase of the car comes with 12 days of rentals from Enterprise each year, so drivers with road trips in mind can go places electric cars can't reach yet.