Electric Car Wave Offers Opening to Startups

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"A potentially industry-changing David-vs.-Goliath battle."

General Electric's announcement that it will switch to battery power for half its huge sales and service fleet comes as good news for proponents of electric propulsion.

General Motors alone stands to pick up orders for at least 12,000 Volt plug-in hybrids in a deal that is likely to be much-discussed at the annual Los Angeles Auto Show, which opens this week.

Proponents of what industry insiders refer to as "electrification" see GE's move as just the breakthrough battery cars need. Fleet buyers, rather than retail, may be the force that gives the nascent green technology the momentum it needs to reach critical mass, said Robbie Diamond, CEO of the Electrification Coalition, a trade group.

"Fleet owners and operators," he said, following the GE announcement, can "lead the way in this transformation. . .to accelerate the development of electric vehicles.

In a potentially industry-changing David-vs.-Goliath battle, fledgling makers such as Amp, Aptera, Think, Tesla and Fisker, among others, are betting they can take on the well-funded giants who have long dominated the automotive market.

"It's the first time where that's been possible in more than a half-century," said Jim Taylor, a former General Motors executive.

Aaron Bragman, an automotive analyst with HIS Global Insight, says he remains skeptical about the viability of electric propulsion, overall, particularly when it comes to the consumer market. But there's a real potential among fleet buyers, he adds, who are more likely to have a clear understanding of their daily driving requirements—and a significant desire to curb fuel costs.

Which, if any, automaker will make the battery market pay off remains to be seen, and it's far too early to tell whether it will be David or Goliath who can claim victory.

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