Luxury Electric Vehicles – Tesla vs. The World

Tesla Model S | Luxury Electric VehiclesSince its release in 2012 the Tesla Model S has been showered with praise and accolades from across the board. A perfect 5.0 safety rating from the NHTSA; Automobile Magazine‘s 2013 Car of the Year and “Car of the Century” by Car and Driver Magazine among many others. It set standards not just for an electric car, but as a luxury car of any description.

Yet there still remains hurdles for electric vehicles, even one as feted as the Model S – such as the charging infrastructure or lack of familiarity with the technology. The price, $70-80,000, which though not exorbitant for a vehicle of this kind, may seem a lot for a nascent brand and an emerging technology. However, luxury manufacturers have always been aware of the potential electric vehicles have and have not held back in launching their own efforts with varying results.

Luxury Electric Vehicles – The Present

The Mercedes-Benz B-Class EV, launched in the US in the Summer of 2014 and in Europe early 2015 is a fully electric version of their compact sports tourer. It was generally well received, but was only available in a limited number of states. In terms of range and price it did not compare favorably to other fully electric compacts like best-selling EV the Nissan Leaf.

Similar to the Mercedes offering – the BMW’s i3 has proven more successful so far – the third best selling EV in the USA in 2014 behind the Model S and Leaf. Favorable reviews and 6000 units sold last year represent success for a vehicle which was described by Car and Driver as both feeling “like the future” but also having “stubby styling.”

Both these cars are built to appeal to a wider luxury market, but looking ahead two recent announcements might be ones to keep an eye on. Audi released some initial sketches of their e-Tron Quattro earlier in the year, but made a splash at the International Motor Show in Frankfurt. Scott Keogh, told Automotive News that “it plans to turn its e-tron Quattro SUV electric vehicle concept into a production model in 2018. After that, the company will work on another electric vehicle, and Keogh expects electric vehicles to account for one-third of the company’s US sales by 2030.”

The Frankfurt show also saw the world premiere for the Porsche Mission E – the brand’s first ever all electric four seat sports car. Currently a concept car – the company has plans for it to be in full production within 5 years. Clearly Porsche feel the time is right for them to be able to deliver an EV that does not compromise on luxury or performance.

Aston Martin are also planning to release an EV version of their Rapide S within the next couple of years. Though there may be ulterior motives for this as emissions and fuel efficiency regulations make it more difficult to produce so many luxury gas-guzzling vehicles. As Aston CEO Andy Palmer put it – “If you want to keep making V-12 engines, then you’ve got to do something at the opposite end of the spectrum.”

In terms of electric vehicles that do not compromise their luxury entirely for environmental credentials, look no further than the Porsche 918 Spyder, released in 2014 with a limited run of 918. Pricing started at $845,000, but, thanks to its hybrid engine, it did come with a federal tax credit of US$3,667, well every little helps…

Luxury Electric Vehicles – The Future

It’s quite certain that the next five to ten years will see some drastic developments in terms of new luxury EVs. The question remains who will capture this emerging market with the right product. The big difference between Tesla and other luxury auto manufacturers will always be that Tesla is 100% electric, whereas other luxury auto companies are starting to dip their toes into the EV waters. We are definitely still a few years away from seeing which gives the greater advantage – being an EV native or being a luxury native.

About the Author:

Joe wrote about luxury asset trends for Borro Private Finance.