That was the radical proposal put forward in 2007 by Shai Agassi, the charismatic chief executive of Better Place, an electric vehicle company that proposed a novel way forward for widespread EV adoption. Six years later and many retrenchments on, including one that led to Agassi’s ouster from day-to-day company operations, Better Place has filed for bankruptcy protection, the company announced on 26 May.
With supporters that included former US president Bill Clinton and Israeli president Shimon Peres, Better Place arrived in virtually open water – more than a year before Tesla Motors’ Elon Musk and Renault-Nissan’s Carlos Ghosn began to monopolise the discussion around electric passenger cars. Its famous boosters, combined with Agassi’s tireless promotion, helped land the company a pivotal cover story in Wired magazine in 2008. Better Place never wanted for publicity afterward.
Unlike Tesla Motors and Fisker Automotive, the best-known of the EV startups of the last decade, Better Place was never conceived as a car company. It was instead an EV infrastructure company, intent on building networks of battery-swap stations, where privately owned purely electric cars would pull up and have their depleted batteries swapped out for a topped-up pack in minutes. The batteries were leased out by the company, not owned by the cars’ drivers.
The model faced significant challenges. It required Better Place to secure an automaker partner that would build cars that were compatible with Better Place’s swap hardware. Renault-Nissan filled that role, with its Fluence ZE sedan, which was engineered from the start to accommodate battery swapping. (It should be noted that Elon Musk also built the Tesla Model S to be swap-compatible, but no such infrastructure exists yet for the $100,000 sedan.)
A more banal, but ultimately fateful, challenge came in the form of pricing. Better Place required a customer to purchase a Fluence ZE and lease the battery pack. The 551-pound lithium-ion array is similar to that used for Renault’s new Twizy urban runabout, although swapping is not currently offered for that car. But the prices were prohibitive, relative to the all-in sub-$30,000 price of a Nissan Leaf combined with tax incentives. In France, the Fluence, sans battery, would cost roughly 21,000 euros, and swap infrastructure was slow to appear.
Better Place began implementing its vision in a controlled manner, launching swap stations for electric taxicabs in Tokyo and targeting small countries that were strongly incentivised to limit their oil consumption, like Israel, Denmark and the Netherlands. Though the model found adoption in those countries, Better Place struggled to scale its vision to suit larger markets. Ultimately hampered by high operating costs, it retrenched in early 2013 to focus exclusively on its business in Israel and Denmark. This followed the shunting over of Agassi, the company’s founder, from chief executive to member of the board.
For a company that commanded a valuation of $2.25 billion as recently as November 2011, the fate of Better Place is sobering, and may reverberate through the automotive industry for months. Meanwhile, Tesla Motors’ stock has been trading above $100 per share. The electric vehicle landscape has never looked more opaque.