Turmoil in the Middle East, uncertainty about oil prices, and gasoline still flirting with the nerve-rattling level of $4 per gallon in some parts of the country are making consumers nervous. Even after prices slipped in response to concerns about reduced demand from the crisis in Japan, oil is now trading at about $100 a barrel. Prices are likely to stay high in the near term, or even rise further, given recovering economies in much of the world, unrest in the Arab world, and the coming summer travel season.
We’ve been there before, only worse. In 2008, when oil peaked near $150 a barrel, car buyers stampeded away from big, gas-guzzling vehicles and overall auto sales collapsed. Just as Hummers were practically being given away, automakers responded with fleets of smaller hybrid vehicles, and the path to sustainable energy consumption was set.
The good news today is that the U.S. is better prepared to cope with an oil crisis with the advent of the electric car. All but written off in the 1990s, following GM’s decision to junk its EV1, dozens of highly efficient electric vehicles (EVs) are headed for U.S. roads this year and next.
“It’s not just improved car technology,” says Jack Hidary, Global EV Leader at Hertz, which is rolling out electric vehicles at rental sites in the U.S. and overseas. Beyond carmakers, other big players “see a roadmap of business models to make EVs a commercial success,” says Hidary, a technology entrepreneur who was a co-architect of the federal Cash for Clunkers program…