Hello and good morning!
General Electric this morning announced that it is going to buy 25,000 electric vehicles for its fleet by 2015. Because General Electric provides much of the componentry and services much of the value chain of the electric car markets it is effectively jump-starting one of its major strategic areas of interest: the environment.
CEO Jeffrey Immelt has had my attention since he took over from Jack Welch because of his massive investments in two strategic areas: clean energy and clean water. Immelt says that the electric car market could generate $500 million in revenue for GE over the next three years. Clearly the conversion of much of their fleet will help the adoption rate of electric vehicles and drive scale.
The vehicles are to be the Chevy Volt. So a nice pick up for General Motors to say the least. Meanwhile, in the wrong-headed category of business leadership, Daimler-Chrysler’s CEO was quoted on this very same day saying that electric cars are over-hyped. Could greater evidence of Daimler’s horrible record of timing be provided? Perhaps if General Electric had purchased 25,000 vehicles from Daimler the story would have been different. Just saying.
Why is the electric car not overhyped, in my opinion? One of the legitimate criticisms of the electric car is that it still has an environmental footprint. While emissions may be lower, to generate electricity at the frontend requires the burning of coal, the fissure of atoms, the churning of hydroelectric dams, the capturing of thermal heat, etc. So there is still environmental degradation. However, what is often not talked about is that electricity can be generated by very clean sources of energy, such as wind and solar energy. In fact, electricity can be generated by rubbing your hands back and forth over your sweater. So let’s put this on a scale:
- On one hand of the scale we have oil – a monolithically same source of energy that is ever more scarce and requires ever greater risks to extract (think: Deep Water Horizon). And the emissions are poisonous to the environment.
- On the other hand we have electricity that can be generated from at least half a dozen viable sources providing tremendous flexibility in terms of providing the lowest price to the consumer at the moment of consumption and that can be produced with a minimal environmental footprint. And the primary emission from an electric car is………heat. Hmmm.
Thanks for putting the electric in General Electric Mr. Immelt!
Jason
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I was studying something else about this on another blog. Interesting. Your perspective on it is diametrically opposed to what I read to begin with. I am still reflecting over the various points of view, but I’m inclined to a great extent toward yours. And no matter, that’s what is so super about modernized democracy and the marketplace of thoughts on-line.I will are available back again.
I am glad to have provided another point of view. I hope that whatever view you settle on is uniquely your own. Jason
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