5 Minutes with… Ed Kim

Dec 3, 2009

Green vehicles have proven themselves to be much more than a futuristic notion, with a few very recognizable models roaming streets across the nation. But with gas prices down and the economy in a state of uncertainty, what, if anything, stands in the way of these environmentally considerate offerings becoming rampant?

Restyling asked Ed Kim to give us his take on the future of green vehicles, and what it may take to bring them to the masses –  and into restylers’ shops in droves.

Kim is the director of industry analysis at AutoPacific, Tustin, Calif., a company specializing in the analysis of the automobile industry. The firm publishes a wide variety of syndicated studies annually (for more information, visit www.autopacific.com).

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RE: What’s really driving the “green” market today?

KIM: Well that’s a very macro-level question. There are, beyond some of the obvious things, numerous factors driving interest in green issues-it’s become a politically correct thing. Starting in Europe, even in the last decade, there was a lot more policy development along those lines. It just took longer to get here. Relative to the car market, one of the things that really drove interest in green vehicle technology was a higher fuel price. The inconvenience of paying $50 rather than $25 to fill up your car makes consumers angry; that in turn drives people to want to spend less on fuel. Looking at some of the issues behind those fuel prices, for better or for worse as prices on gas have gone down, people’s memories are very short and their attitudes are often impacted by how it hits them in the pocket book.

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RE: Do you think the high prices last summer contributed to a shift in attitude?

KIM: When it was $5 a gallon and hitting hard, [people] were interested in increasing their stated interest in green issues, but I’m not sure that caused a real shift in attitude. That is yet to be seen. Fuel prices are very emotional – you face it every day driving to work. There’s also been a lot of impact on acceptance of green issues, especially with celebrities buying hybrids. The weight of pop culture on what’s in has an undeniable impact. On [HBO’s comedy] Curb Your Enthusiasm, for example, you have a wealthy but somewhat self-righteous person in L.A., and his Prius is prominently featured in the show. Little messages are constantly reinforced.

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RE: Do you think we’ll continue to see sales increase in the U.S. where green vehicles are concerned, or will they see greater popularity in Europe and Asia?

KIM: The whole concept of green has a lot of pull in Europe, but the fact they have always driven smaller cars is also driven by high fuel taxes. It’s not necessarily about the environment, but more about infrastructure and economics. Here in the U.S., green issues are more financially driven than anything. When you are worried that you are going to lose your job and not able to put food on the table to feed your family, a person’s focus shifts away from “we” as a society to “me” and how I am going to pay my bills rather than decreasing emissions. A lot of factors are working against green issues right now in the U.S., especially the economy. Within the U.S., hybrids are very coastal things, incredibly popular along the entire West and East Coasts. Those areas tend to be a bit more liberal and progressive, and that mindset will go for a hybrid more.

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RE: We’ve already seen hybrid vehicle sales grow (though it slowed when gas prices dropped below $2/gal.). Will electric vehicles or another alternative power source catch on by, say, 2014 in your opinion?

KIM: The key to making an electric vehicle work is infrastructure and technology. We are just not there yet, and in the next five years, not a chance. Think about how you interact with your own vehicle. You rely on your vehicle to get you somewhere right now; you could just hop in and go. If you’re low on gas, you stop and pump gas. There is no electric infrastructure right now that allows you to do that. It’s not even just convenience; we depend on our cars in ways that go beyond that. What if a family member got sick and you had to get to the hospital right now? What if there was a big meeting 150 miles away and you had to get there right now? It’s the appeal of automobiles that is so universal -” it’s flexibility and freedom all at the same time.

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RE: Can you elaborate on where new technology fits into that?

KIM: With electric vehicles, you have a very limited range, maybe 75 to 100 miles. The best vehicles take about an hour to recharge. But when they become more popular, they will be a high-image purchase. It makes a strong statement about the kind of person the owner is, just like the Prius. But until the infrastructure is there, the buyers will be affluent and own multiple (including gas-powered) vehicles.

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RE: With so much new and green technology on the horizon, what type of vehicle power in your opinion will win the race?

KIM: Right now we are in the beginnings of a format war. Many technologies are out there, but it’s hard to say now what is going to be the dominant fuel of the future. Electric vehicles are a niche thing. But you can’t make these kinds of advances in technology without earlier versions to build on, and they will play a significant role in the type of vehicles that we will all eventually end up driving.