BMW plans to extend range on the i3 – but can it calm 'range anxiety'?

BMW plans to extend the driving range of its i3 electric car next year in an apparent attempt to alleviate drivers’ “range anxiety” – the fear their battery will run out of charge before they reach their destination. This persistent fear has dogged the market, with electric vehicles still accounting for less than 1 percent of all vehicle sales worldwide.

BMW plans to equip the i3 with a new battery that the company says would extend its driving range substantially beyond the about 186 miles (300 kilometers) it can currently travel on a single charge, the German weekly Welt am Sonntag reported, citing company sources. The newspaper said the new battery would increase the driving range of the i3 less than 50 percent, putting its maximum range at around 279 miles. 

Automakers and analysts have said an electric vehicle that can drive 200 miles is the bare minimum needed to assuage the so-called “range anxiety,” with Tesla founder Elon Musk saying in 2015 the “sweet spot” is anywhere between 250- 350 miles. The new i3 will likely fall into the low-to-mid end of this ideal range. But it’s part of a trend among major automakers to offer a fleet of electric vehicles in the coming years at different costs, but all with longer ranges.

“Everyone is looking for cheaper, lighter, and longer-range batteries. The quest will not end,” Michelle Krebs, a senior analyst for Autotrader, tells The Christian Science Monitor in a phone interview.

Two hundred miles is “the ballpark for the newest electric vehicles now,” she adds. “Eventually, there will be a push to do more. But that will take some technological doing. Batteries are still heavy and expensive, and you have to package them in a vehicle.”

Nevertheless, a spruced up, long-range i3 is a major improvement over the city car BMW first debuted in the United States in 2014. The first version of the i3 could travel less than 100 miles on a single charge.

Despite BMW's early investments in this model, the i3's sales were lackluster: 25,000 i3s were delivered last year, according to Reuters. BMW already extended the battery of the i3 once this year, reaching 186 miles per charge.

Yet the German automaker hasn’t been alone in its struggles to sell electric cars, which have remained below 1 percent of all vehicle sales since they reached the market. In 2015, the number of pure electric cars sold was 550,000, just 0.007 percent of the global fleet, according to the Financial Times. About 116,000 of those cars were sold in the US. The year before, 67,700 electric vehicles were sold in US, about 0.4 percent of the 16.5 million new cars and trucks sold here, according to Reuters.

The current stretch of low gas prices has hurt electric vehicles (EVs) as pickup and SUV sales have once again risen. But analysts consistently return to “range anxiety” as one of the main detriments to EV sales, even as researchers at MIT and the Santa Fe Institute have found the fear is largely overblown.  

In a sweeping data analysis published in August, the researchers found a 2013 Nissan Leaf (a low-cost electric vehicle that can travel up to 84 miles on a single charge) or a comparable electric vehicle could satisfy 87 percent of American commuters’ daily needs. But it’s the remaining 13 percent that likely has beleaguered electric vehicle sales.

That’s because “North American buyers expect their cars to be fully capable under virtually all circumstances,” writes John Voelcker of GreenCarReports.

“Cars with greatly limited functionality – two-seaters or unibody trucks, for example – sell only in tiny volumes,” he writes. “So an electric car will have to be able to travel long distances to break into the mass market.”

But the buzz around pre-orders for Tesla’s Model 3 in March could be an indication of the right price point and driving range for low-cost electric vehicles. The electric vehicle maker received about 373,000 pre-orders for the $35,000 sedan, which Mr. Musk has promised will have a driving range of 215 miles.

Analysts are skeptical Tesla will be able to deliver the vehicle to customers by the end of 2017. But the comparable Chevy Bolt and BMW i3 are scheduled to reach consumers by then. Chevy has said the 238-mile Bolt will be $37,500, with $7,500 available in tax credits for the first 200,000 vehicles sold. The price of the 2018 i3 isn't available, although the 2017 version with a shorter range will start at $42,400, according to CNET.

Meanwhile, other major automakers are working on releasing their own electric vehicles to compete for the top spot in the luxury electric car market, arguably held by Tesla. Tesla's Model S sedan and Model X crossover can travel more than 220 miles per charge, with costs starting at about $80,000. Audi has plans to launch at least one electric vehicle per year beginning in 2018, with its Q6 e-tron SUV slated to go on sale in 2018. Mercedes-Benz also plans to have 10 electric vehicles on sale by 2025. In addition to the i3, BMW also plans to launch a fully electric X3 SUV in the next two years, followed by an all electric version of its next generation 3 luxury series, according to BMW blog.

And all of this will have a dramatic effect on the entire electric vehicle market, says Ms. Krebs at Autotrader.

“That’s the way of every new technology,” she says. “Technology almost always starts in luxury vehicles and works its way down.”

This report contains material from Reuters.