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Featured Advisor

Kim Butler

Partners for Prosperity, Inc.

City:Mt. Enterprise

State: TX

I have 20+ years of handling alternative investments in cash, growth and income for clients nationwide.  I strive to help my clients with all things financial in every way possible over the phone and the web.  I own an alpaca farm which I enjoy working during my downtime.  I also enjoy gardening, writing and reading books.  I also train other advisors on Prosperity Economics.

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Luxury Automakers Turn Electric

While Chevrolet’s Volt and Nissan’s Leaf have been hailed as the first plug in electric vehicles (EVs) to be marketed to the masses, they’re not the only option in this still young and emerging technology. Within the last five years auto makers have made serious efforts to roll electrics into their line-up, and high end manufacturers are no exception.

Porsche recently announced that they are now taking orders on the new 918 Spyder. Unveiled last year as a concept car, the Spyder bundles a 500-horsepower V8 gasoline engine with two electric motors that should add an additional 218-horsepower. Needless to say the Spyder, in true Porsche form, will not lack for power or speed with the ability to launch to 60 MPH in 3.1 seconds and topping out at nearly 200 MPH.

Porsche is joining a market pioneered by California based Tesla Motors, who first made their Roadster Sports EV available in early 2008. In contrast to the 918, the Tesla Roadster boasts an all electric battery system capable of going over 200 miles on a single charge. While not as powerful as the 918, the Roadster reaches a very respectable 125 MPH without an internal combustion engine while soaring from 0 to 60 MPH in 3.7 seconds.

So what price can customers expect to pay for top of the line tech and performance? The Tesla has been selling with a base price of $109,000. Subtract $7,500 after a federal tax available for all EVs and your looking at $101,500. This, however, is an absolute bargain when compared to what you’ll have to pony up for the Porsche 918 when it rolls out in September of 2013. Porsche will be producing (fittingly) only 918 of the Spyders, each with a sticker price of $845,000 - before shipping and taxes. Other notable names entering or with plans to enter the high performance electric market include Lamborghini, Ferrari, Audi, and Mercedes.

A recent CNN Money article quotes Sebastian Blanco, editor of autobloggreen.com:
“If a company doesn’t have a hybrid or an electric car, that stands out now.” Some of the benefits for manufacturers to offer EVs are brand awareness and perhaps more importantly, meeting more stringent government fuel efficiency ratings in the years to come.

Like all EVs, the high performance models will greatly reduce carbon emissions while saving money on fuel costs. In the case of the all electrics, gas pumps can be completely forgone. While these factors may be the primary reasons consumers shift to the Volt or Leaf, that probably is not the case for buyers of the Porsche 918 or Tesla Roadster. Some consumers will no doubt adopt the vehicles for the “green” benefits coupled with the manufacturers’ customary luxury. However it’s more likely car enthusiasts will be more eager to simply have the latest the industry has to offer. After all, it’s hard to imagine fuel costs factoring into the decision of a Porsche customer contemplating the $845,000 918 Spyder.

With time, battery range and power should continue to increase, perhaps winning over luxury traditionalists hesitant to sacrifice the high output of their internal combustion rides.