Think City coming to the U.S. - info overload
by Sebastian Blanco on Mar 12th 2009 at 7:54PM 
One potential design for the next-gen Th!nk City
"A small and humble beginning."
That was how Th!nk CEO Richard Canny described his company's proposed expansion to America. It certainly wasn't a big, flashy roll-out in Ann Arbor this morning, but Canny and Th!nk North America CTO Jim Lyons made the most of a drab conference room to sell the assembled journalists on the potential of this sub-$20,000 electric car (that price comes with a big qualifier) in the U.S. market.
One thing that both Canny and Lyons repeatedly mentioned was that electric cars don't need to be figured out; a lot of them just need to be built so that they're cheaper. Lyons said that most estimates put the near-future cost for battery manufacturing at $250-300 per kWh once economies of scale are ramped up. For Th!nk, which hopes to begin fleet operations in 2010, followed by a full retail launch in 2011, that means they can sell their car for under $20,000 and lease the battery to the user for $80-90 a month. "There is no technology risk left in electric vehicles," Canny said. "This is a technology that is here, it's stable, it's available. What it lacks is scale."
We've got all the details about Th!nk's expansion to America after the jump. You can also listen to the presentation here (57 min):
(You can also download the 79 MB audio MP3 file from here)
Gallery: Think City in Detroit
Th!nk started business 17 years ago (as Pivco Industries) and, in almost two decades, has sold "a few thousand vehicles." That includes the four years when Ford owned the brand from 1999-2003. The relationship between Ford and Th!nk continues to this day, with some Ford parts used in the City and licensing and royalty agreements in place between the companies. Th!nk also a relationship with PSA (more history on Th!nk here).
Today, Th!nk is a Norwegian company that has had it's share of recent troubles. Things are looking better for the company, but Canny said that Th!nk is "not out of the woods yet." Currently, the company is going through the Norwegian version of Chapter 11 and is looking for private financing in order to get production started again there. Before the financial troubles started last year, Th!nk produced and sold somewhere between 350 and 400 of second-generation City models in Norway. The Euro-spec model that was on hand in Ann Arbor today uses a 35 Kw motor that is capable of moving the City up to 62 mph. For the America market, Th!nk will likely use a 50 Kw motor to get 72 or so mph. Should the Ox concept ever arrive (they said it was still "a ways away"), look for an 80 Kw unit under the hood. As for batteries, the Th!nk's EL Drive uses one of three battery types, all of which are 18 kWh or more. Thanks to a battery pack that will probably be about 25 kWh, the U.S. City will qualify for the full $7,500 federal tax rebate.
Gallery: Geneva 2008: Th!nk Ox and City
Th!nk wants to come to the U.S. not only because of the potential for funding but also because they think the market is ready for an EV here. As we mentioned in our earlier post, Canny made clear that all these U.S. expansion plans are dependent on Th!nk NA actually getting the DOE loan it will apply for on March 31. "If the U.S. wants to be a leader in lithium ion battery production, you've got to have some cars to put them into. Some of those cars would come from the domestic OEMs, but if you look at Th!nk, we're the first people out there buying lithium batteries at any kind of scale," he said.
What happens if the DOE money comes through? Well, Th!nk would build its North American plant, probably in a place where the cars can be produced and sold; and a nearby battery production facility would help (currently eight states, including Michigan, are in the running for this plant). This would be as uncomplicated a plant as possible. The Norwegian facility uses Th!nk's simple manufacturing process (developed with help from Ford and Porsche), and could break even by making and selling 5,000 vehicles a year. Following the City's U.S. introduction, Th!nk NA would design a new body style in 2011 (maybe like this) that would be used around the world. The electric drive technology would stay the same. Currently, the City meets all European crash test standards and also meets all of the European appliance standards - it needs to do this because it plugs in. Canny said Th!nk expects the American version to easily meet all Federal Motor Vehicle Safety Standards (FMVSS).
Canny (right) and Lyons
Originally, Th!nk North America was established as a joint venture with Kleiner Perking Caulfield and Byers (25 percent) and Rockport Capital (25 percent). Parent company Th!nk Global owned 50 percent, but then reacquired all of the Th!nk NA shares from the other partners in a non-cash transaction.
One more note on the battery lease idea. Canny said that Th!nk NA would not exclude battery sales (instead of the likely $80-90 montly fee to lease the batteries) should someone come to them and directly ask for it, but at this point they are not sure that's what the market will demand. I guess it's up to you to tell them what you want, folks.
UPDATE: read our first driving impressions here.
Click above for a gallery of the Th!nk City in Detroit
Reader Comments (Page 1 of 2)
Mark 8:19PM (3/12/2009)
Leasing the battery?
Sorry. By forcing a 'leasing' scheme on people, the value is essentially zero.
What guarantees are there that Th!nk won't recall the batteries?
What guarantees are there that Th!nk won't discontinue the batteries? If they do, what are you left with? a 20K large outdoor paperweight.
I see why they are doing it this way: To be less expensive for the consumers.
BUT, after what happened in the 90's with leased electric cars (They recalled and crushed them), do you think that people will take that chance?
I don't. Either I can buy outright, or they don't get a dime from me.
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polo 3:08AM (3/13/2009)
If you read the article you'd see they don't intend on forcing anything on anybody.
"One more note on the battery lease idea. Canny said that Th!nk NA would not exclude battery sales (instead of the likely $80-90 montly fee to lease the batteries) should someone come to them and directly ask for it, but at this point they are not sure that's what the market will demand. I guess it's up to you to tell them what you want, folks."
They're willing to sell the batteries out-right, and are looking to see what consumers want before setting a firm strategy. See, was it really that hard?
Zeph 8:22PM (3/12/2009)
Leasing batteries? No. Do not want. Is a rip off. Just sell them, with a lifetime warranty, it's not like they have moving parts. I can recognise a scam when I see one.
At the moment my fuel costs are around 100€ a month (1.6 diesel, around 1000 milese). Battery plus electricity has to substantially beat that for me to take the low range caveat of current gen electric cars. Anything over 50€ month plus a 5 year battery change requirement (with warranty for the battery always) is not acceptable.
I know corporations want as much money as possible, but aren't we supposed to be saving the planet here? (I know it's all bs, but play along...)
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Richard 4:39PM (3/13/2009)
Actually Think themselves dont lease the battery out. At least not in Norway, It is the battery manufacturer who does that, Its their mane on the bill you get in the mail,
Ken 9:25PM (3/12/2009)
I agree. No battery lease, please. Sell me the vehicle and I'll be first in line. In the mean time, I'll convert a Chevy Aveo and put the lead-acid batteries in the back seat. Call me back when you'll sell me the whole Th!nk.
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tinman 9:54PM (3/12/2009)
Why can't they just use Steorn orbo technology instead of those silly batteries.
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GoodCheer 9:53AM (3/13/2009)
tinman: Lucky you, you can buy the car, and buy a Steorn, and not have to lease the batteries. Everyone wins! Me, I'll stick with something that works.
why not the LS2LS7? 10:05PM (3/12/2009)
These already came and went once in the US. They are mentioned in "Who Killed the Electric Car?" and I've seen them parked in Palo Alto city garages.
And Th!nk has gone broke several times since then. These goals seem more hopeful than realistic.
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polo 3:08AM (3/13/2009)
Does anybody actually READ the articles?? They said their plans are conditional on the DOE loan. No loan, no North American rollout.
Stew 11:58PM (3/12/2009)
This is really exciting to me; the Th!nk City is the car I want to make it to the US the most, and it has all the features I want. Freeway capable, can seat 4 with the optional rear seats, and a range over 100 miles.
But honestly the leasing part is an issue for me. I would not want my car taken away from me by an auto manufacturer because all of the sudden they decide they don't want to have a BEV program anymore. It all must be for SALE.
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Richard 4:39PM (3/13/2009)
I don´t think you have to worry about Think not wanting to make BEV´s all of the sudden. Its in their DNA and every fiber of their "auto belief system"
Unless of course they get bought out by a big traditionall automaker once more, and they basically has to take everything that comes from the top
JoeP 12:15AM (3/13/2009)
The battery lease thing might be for the benefit of customers...I believe they think people are concerned that the batteries will be a recurring cost.
Their idea is to reduce the lump payment of batteries and turn it into a monthly amortized cost, and this way you never have to pay for batteries again...just bring in the car and get a new pack once their capacity drops below a certain level.
If they are smart, they will cater to people who are paranoid about large corporations (not entirely undeserved) and offer to sell them as well.
I guess they also might be thinking that as the price of batteries go down, they could still receive the same monthly payment, thereby increasing their profits. These plans don't often last in the market, though.
I'd th!nk seriously about getting one of these cars for $20k, especially if I could get a $7500 tax benefit, and other Americans could have jobs, and if the car is built with quality.
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Kelly Erin O'Brien 1:57AM (3/13/2009)
I've been driving a RAV4-EV for 8 years, now... battery lease???? You can stuff it! It's a non-starter... so, do yourself a favor... kill your project before you've begun!
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jpm 2:14AM (3/13/2009)
I WAS excited about Think coming to the U.S. until they decided to pull this leasing bullshit out of their ass. Grow some balls and just sell your car.
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Imee 3:13AM (3/13/2009)
I like European cars, and the photos of the Th!nk City are really cute actually. They're compact and perfect for the future. The only odd thing about it is the "leasing batteries for $90 a month" bit. It's strange!
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Stan Wellaway 5:41AM (3/13/2009)
Guys, in the UK, the second biggest maker of commercial electric vehicles is Modec (no relation to the US company of that name) http://www.ModecZEV.com
They just signed a marketing deal with Navistar, to bring Modec vans to the US. FedEx and UPS already bought their vans (for use in London) and opted for the battery leasing arrangement. This has been Modec's suggested approach from the outset 3 years ago. They sell their vans "batteries not included" at about $42k, and charge an additional $550 a month. Buying the vans WITH li-ion batteries would bring the purchase price to around $58k - almost double!
Their bigger UK rival, Smith Electric Vehicles, who outsell Modec about 3-to-1, have always sold their vehicles inclusive of batteries. But they too are sometimes being asked to offer a leasing alternative, which they apparently now do as a secondary option, though this isn't actually mentioned on the UK website http://www.smithelectricvehicles.com nor on their new US website http://www.sev-us.com
It isn't a scam. It's purely a way of coping with the present high upfront cost of battery purchase. Modec I believe are keen to progressively reduce the monthly charge as fast as they can. But they argue that at present the customers prefer this arrangement. Once the industry has scaled up production, so that li-ion batteries no longer make up 40% of the vehicle cost, I daresay the leasing deal will become less and less appealing.
However, knowing what previously happened in the US, I fully understand the extreme hostility towards leasing, and fully understand the suspicions that it's not to be trusted.
One other thing; it seems quite possible that in territories where the leasing approach does find favour, the electricity comanies, rather than the vehicle makers, will in future be the party that owns and leases the batteries..
As for the Th!nk car itself, I'm afraid I don't like it. And as mentioned by others, its history is offputting. Its bigger brother, the Th!nk Ox, looks more interesting - if it ever happens.
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Tommy 11:41AM (3/15/2009)
I don't care about any of these complaints.
Where do I send my deposit ?
theboomboomcars 10:03AM (3/13/2009)
Unless they are giving you new batteries every 2.5 years it is cheaper to buy the batteries out right than to lease them. Since the $550/mo payment makes up for the $16000 price difference in 29 months.
Stan Wellaway 10:17AM (3/13/2009)
theboom,
I think one of the problems is that customers are (understandably) very wary of shelling out a huge amount of cash on batteries whose longevity in service is not yet proven - and which might suddenly become obsolete when the next tech breakthrough occurs. We are talking of a battery pack costing between say $9000-$17000 for a car, or maybe as much as $28,000-$40,000 in the case of a truck. That's a hell of a gamble if buying outright - especially from a company that might not be around to honour whatever warranty is offered. I'll be interested to see what kind of battery warranty is offered with Ford's electric Transit Connect when it appears in US showrooms next summer (it is apparently being priced inclusive of batteries).
Randy S 2:41PM (3/13/2009)
One of the reasons I think companies like the lease arrangment is because they can expense the full cost of the lease each year, rather than the CCA percent depreciation method required for capital asset purchases.