Meaningful innovation

What will replace A Better Place?

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A Better Place battery swap station

I was disappointed to learn about the liquidation of electric car infrastructure provider A Better Place earlier today.

I really admired Shai Agassi’s vision for this business, and have highlighted it as a great example of both social innovation/shared value (business with a social/environmental benefit at its heart) and design thinking (replicating the convenience/experience of a service station for the electric vehicle age) in presentations and workshops that I’ve facilitated. Naysayers will no doubt latch on to this event as reasoning for a) why social innovation/shared value doesn’t work and/or b) why electric vehicles are not going to succeed (case in point).

They externalised and amortised one of the key drivers of higher costs of electric cars (commentary I’ve seen puts the battery at about 20–30% of the cost of the vehicle). The model also presented real business incentives to improve longevity and management of battery technology waste due to the side-effects of product service systems. Batteries could be more easily rolled out to customers over time as well, as new technology came to market without modification to the vehicle.

I also admired the multi-faceted nature of the business—which proposed not only technology for battery swapping, but also more general charging infrastructure. I saw an interview with Agassi where he described A Better Place not as a charging or battery company, but as an energy company. They saw the potential for electric cars playing a significant role in smart grid infrastructure—a vision much broader than just cars.

The article linked at the outset of this post doesn’t go into a lot of detail, other than to suggest public uptake of electric vehicles was slower than anticipated, and gaining automotive supplier support was a key barrier.

It’s perhaps ironic that a company set up to remove one of the key barriers to electric vehicle sales—the “range anxiety” issue—was unable to get sufficient support from automotive manufactures, who report lower-than-expected uptake of electric vehicles as a reason not to invest more. Seems like a classic chicken and egg conundrum, that A Better Place was looking to solve and externalise for the manufacturers. Given only one vehicle manufacturer—Nissan Renault—got behind the initiative, it does beg the question just how serious car companies are about really advancing this market. That said, even leader Tesla Motors hadn’t gotten behind the approach, as far as I know, and they certainly can’t be accused of not promoting/supporting an electric vehicle future. (I would be especially interested in Tesla’s comment/take on A Better Place’s closure.)

I suspect the biggest problem was simply trying to launch too early to support an immature industry. That is to say they were simply ahead of their time. Electric vehicle technology is in its relative infancy, and standards and technologies are evolving rapidly. I suspect it was difficult to get manufacturers to commit to a standard given the many different configurations and challenges related to A Better Place’s approach. Battery technology, in particular, is rapidly evolving.

And placement of batteries within a floor-pan is not as simple as finding a place for a petrol tank. For example, some manufacturers have layered them across the floor-pan. Others have placed them behind the seat. Others, still, have them placed in various locations across the vehicle to balance weight and driving dynamics.

I’ve not had a moment to review further commentary on the closure, so I’ll be interested to learn more in the coming weeks/months as more is written about A Better Place’s experience, as no doubt will happen. I’d love to read comment from those close to the project, with the benefit of a little distance in time, what lessons were learned.

I have said in the past I don’t think hydrogen fuel cells are coming any time soon (I see this as a bit of a red herring—a future that will perpetually “just around the corner” to give manufacturers and excuse for not backing alternatives). And while battery technology is improving at a rapid clip, it will be some time before charge times reduce to minutes, instead of hours. Short of a miracle breakthrough (which is a potential, but still not something we can “bank” on). Will charge time become a non-issue as range increases? I don’t think it will—certainly not in the public’s perception.

So something like A Better Place will be needed if electric vehicles are to achieve widespread up-take in a non-urban/fleet environment, even in the short term. Given A Better Place’s experience, I’m wondering what new venture/approach will step up to take its place?

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2 Responses to “What will replace A Better Place?”

  1. David Gravina
    on May 31st, 2013
    @ 8:37 am

    Thanks for that Grant, i feel your pain!

    I must admit I did wonder why they didnt just develop something that could be added too (and provide an extra revenue source for) existing petrol stations. A little bay to the side that the owner would be provided for free with a cut of profits (ie. the only cost would be floor space) and they’d only need a few batteries per station when theres only a few renaults rolling about. Im suree BP/Shell etc wouldn’t want them but my understanding is a lot of Petrol Stations are franchises so they may have more flexibility.

    Just a thought but yes also sad to see a visionary company with great design and leadership go down. It’s going to happen though – revolutions are never without bloodshed!

  2. Grant
    on May 31st, 2013
    @ 9:27 am

    Yeh, innovation is not without risks, of course!

    I also noted that hot on the heals of A Better Place’s announcement, that Tesla have announced an expansion of their charging network. Not sure if that’s telling, in any way, as to Tesla’s not coming on board with the battery swapping tech. But interesting counterpoint in any case.