The Consumer Electronics Show in Las Vegas once again featured the presence of automakers, as they pushed electronic apps for their cars while one automaker unveiled its first gas-free, fully electric vehicle. It remains to be seen, however, what impact Ford Motor's (NYSE:F) new fully-electric Focus will have on the industry.

IN PICTURES: 5 "New" Rules For Safe Investing

New EV Unveiled
Ford CEO Alan Mullaly announced the new Focus Electric for 2011. The car will feature a maximum speed of 84 miles per hour and is made of sustainable materials including recycled blue jeans. The Focus features a 23 kilowatt hour lithium ion battery, which is capable of being powered at a home charging station in slightly over three hours.

Ford will also be offering electric vehicle charging stations for $1,499, compared to the cost of competitors' charging stations, which average more than $2,000 for installation. Ford has plans to utilize electronics retailer Best Buy (NYSE:BBY) to make these stations available for customers. Ford is also working with both municipalities and utilities to eventually make these stations commonly available throughout the U.S.

Firms are climbing aboard the electric vehicle (EV) platform to address the projected need for more charging systems and outlets. Industrial giants like Siemens AG (NYSE:SI) are working to provide these, while smaller firms such as EvaTran plan to bring out a home-based charging system. It will feature a new induction system which differs from the standard ones by allowing the consumer to plug in, for example, their General Motors' (NYSE:GM) Chevy Volt, to recharge it.

Immediate Future of EVs
It's difficult to predict such a light market as electric vehicles, with its potentially rapidly changing technologies and uncertain consumer demand. California utility PG & E (NYSE:PCG) estimates 300,000 EVs by 2020 in its region. Zpryme pegs EV sales at over 40,000 for 2011, and projects annual sales of slightly over 200,000 total by 2016. Zpryme also estimates the charging industry will eventually be a $1 billion plus market. These numbers of EVs and any revenues are, of course, fractional when compared to the petroleum-based auto industry of today, so we are in the earliest stages of the electronic vehicle industry at best.

A Practical Look
It's great to get excited about the new tech of electric vehicles as well as the potential of alternative energy fueling cars. James Brumley wrote an excellent analysis of the considerable difficulties the fledgling electric vehicle industry still faces. In his Investopedia article of December 23, 2010, "Electric Vehicle's Dirty Little Secret," Brumley points out a number significant problems. The vehicles are neither cost appealing nor do they provide the kind of utility to truly spark a user revolution. The mileage range per electric charge has been very limited, and charging takes too many hours. These limitations will be slow to change. The Focus Electric, however, is a step toward changing these.

Whether one day we will all be driving electric cars or something else - perhaps a Tesla-like visionary will create some unforeseen breakthrough in a different direction - the sobering news on electric vehicles as a consumer product, business and an investment renders them a potentially important development, though they're still in their infancy. In the next decades, the reasonable hope would be that they take their place alongside our fossil-fuel vehicles. Meanwhile, conventional autos along with gas and oil will remain dominant. (If you're not taking advantage of these deductions, you could be missing out on tax savings. See Tax Credits You Shouldn't Miss.)

Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!

Related Articles
  1. Personal Finance

    A Day in the Life of an Equity Research Analyst

    What does an equity research analyst do on an everyday basis?
  2. Mutual Funds & ETFs

    ETF Analysis: PowerShares S&P 500 Downside Hedged

    Find out about the PowerShares S&P 500 Downside Hedged ETF, and learn detailed information about characteristics, suitability and recommendations of it.
  3. Mutual Funds & ETFs

    ETF Analysis: ProShares Large Cap Core Plus

    Learn information about the ProShares Large Cap Core Plus ETF, and explore detailed analysis of its characteristics, suitability and recommendations.
  4. Mutual Funds & ETFs

    ETF Analysis: iShares Core Growth Allocation

    Find out about the iShares Core Growth Allocation Fund, and learn detailed information about its characteristics, suitability and recommendations.
  5. Mutual Funds & ETFs

    ETF Analysis: iShares MSCI USA Minimum Volatility

    Learn about the iShares MSCI USA Minimum Volatility exchange-traded fund, which invests in low-volatility equities traded on the U.S. stock market.
  6. Stock Analysis

    Should You Follow Millionaires into This Sector?

    Millionaire investors—and those who follow them—should take another look at the current economic situation before making any more investment decisions.
  7. Professionals

    What to do During a Market Correction

    The market has what? Here's what you should consider rather than panicking.
  8. Mutual Funds & ETFs

    ETF Analysis: Vanguard Mid-Cap Value

    Take an in-depth look at the Vanguard Mid-Cap Value ETF, one of the largest and most popular mid-cap funds in the U.S. equity space.
  9. Mutual Funds & ETFs

    ETF Analysis: Schwab US Broad Market

    Take an in-depth look at the Schwab U.S. Broad Market ETF, an incredibly low-cost fund based on a wide selection of the U.S. equity market.
  10. Professionals

    Tips for Helping Clients Though Market Corrections

    When the stock market sees a steep drop, clients are bound to get anxious. Here are some tips for talking them off the ledge.
  1. Equity

    The value of an asset less the value of all liabilities on that ...
  2. Hard-To-Sell Asset

    An asset that is extremely difficult to dispose of either due ...
  3. Sucker Yield

    When an investor has essentially risked all of his capital for ...
  4. PT (Perseroan Terbatas)

    An acronym for Perseroan Terbatas, which is Limited Liability ...
  5. Ltd. (Limited)

    An abbreviation of "limited," Ltd. is a suffix that ...
  6. BHD (Berhad)

    The suffix Bhd. is an abbreviation of a Malay word "berhad," ...
  1. What is the difference between called-up share capital and paid-up share capital?

    The difference between called-up share capital and paid-up share capital is investors have already paid in full for paid-up ... Read Full Answer >>
  2. Why would a corporation issue convertible bonds?

    A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
  3. How does additional paid in capital affect retained earnings?

    Both additional paid-in capital and retained earnings are entries under the shareholders' equity section of a company's balance ... Read Full Answer >>
  4. What types of capital are not considered share capital?

    The money a business uses to fund operations or growth is called capital, and there are a number of capital sources available. ... Read Full Answer >>
  5. What is the difference between issued share capital and subscribed share capital?

    The difference between subscribed share capital and issued share capital is the former relates to the amount of stock for ... Read Full Answer >>
  6. What happens to the shares of stock purchased in a tender offer?

    The shares of stock purchased in a tender offer become the property of the purchaser. From that point forward, the purchaser, ... Read Full Answer >>

You May Also Like

Trading Center

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!