An Update On The Better Place Story

Yesterday I published my second post over at the Times of Israel. It is a short explanation of why it’s so important we do anything to move our transport away from 95% oil. It doesn’t have to be only electric cars, but it has to be something. That post is also a bit of a side swipe at the modern green movement, of which I’m deeply suspicious.

Over the last couple of months there has been a lot written about Better Place, most of it pretty negative. It seems November car sales  in Israel pretty much dried up as big corporate clients, and the leasing companies they usually buy through, deferred taking new cars until the future of the company looks more secure.

This was underlined in a Ha’aretz ($) article with the mildly inflammatory headline “Israel Corp. threatens to stop cash infusion into Better Place”. Essentially they have given new CEO Evan Thornley until December to submit a revised business plan which seems reasonable following his installation in October. Green Car Reports has a fair outsiders take based partly on that Ha’aretz article.

Meanwhile, over the last few weeks, Evan has been dramatically cutting the staff at the Better Place head office in Rosh Ha’ayin. That is unfortunate but understandable as he has to find some way to stem losses while the company grows a customer base in Israel and elsewhere.

As A Customer in Israel

Email from Better Place in both Hebrew and English

As a customer, and within the circle of customers, I can tell you we are still a happy bunch. New switch stations have continued to open including (most significantly for me) two more on the vital Jerusalem Tel Aviv corridor. This virtually guarantees that I will only ever switch once on a Jerusalem and back trip. Existing customers, and those who’ve come on board including Israellycool co-blogger, Zionist Shark, are still overwhelmingly delighted with their choice.

In fact, as I wrote about our unusual meeting, the customers are mostly upset over the company’s poor ability to promote and sell cars! Just last night I spent 20 minutes on the phone talking to a prospective customer (he was given my number by one of the sales staff as I’ve agreed to this). The only thing holding anybody back at this stage, once they’ve driven the car and decided it fits their driving pattern, is the future security of the company.

An early niggle I had was that announcements of new battery switch stations were sent by email in Hebrew only and as an image precluding the use of Google translate. These announcements are now made in both Hebrew and English and the text is copy/paste-able and the emails still look pretty!

Answering Press

As an example of the sort of articles written about Better Place, I’ll give some comments on this one that showed up in Time magazine with the headline “A Smart Car Dream in Israel—Not So Smart, After All?”

After a brief description of Better Place’s system in Israel we get the following:

The only thing that’s missing is the cars — or, rather, the people who want to drive them.

….

But starting in Israel always looked like one of the soundest elements of his plan. The Jewish State is not only famed for its innovation

Israel, as a country, deserves it’s Startup Nation status, but that does not transfer to the whole population. Anyone who has lived here for a while knows Israelis are actually very slow, cautious adopters of new ideas and technology. It’s one thing getting people to load a new free app on their iPhones, its quite another trying to sell them a completely new transport paradigm.

And then think of the sizeable chunk of the population who are too religious to even use computers and will only buy a car with 8 or more seats for huge families!

I sell computers and I’m still selling and having customers demand XP: forget Windows 8, almost no requests for that yet.

Better Place should be criticised for not marketing properly in Israel: not enough and only in Hebrew. The early adopters (like me) are disproportionately Anglo and yet Better Place have never advertised in English (or Arabic or Russian which are equally good candidates).

I’ve answered dozens of questions when parked on the busiest predominantly Arab shopping street in Jerusalem (pictures here). There are sales centres in Jerusalem and Haifa but I’ve never seen any Arabic literature: it’s true many of the 1 million plus Israeli Arabs speak Hebrew but still, a sale is always easier to make if the seller goes the extra mile.

 “We do all the green things,” says a middle-aged woman who offered only her first name, Sarit. “We recycle. On camping trips we use only re-usable dishes.  We have solar water heating. We believe in it.  Does belief go anywhere?”   Not if you don’t buy.  She and her husband bought a new car six months ago, and settled on a Subaru over a Better Place sedan after her husband decided “the technology isn’t developed enough yet, and we’ll wait for the next generation,” Sarit says. “But I hope it works. It’s good for the environment.”

This quote rings true and speaks of the majority and thus contradicts the journalist’s opening statements! This is the Israeli mentality: startup nation applies to a small number of entrepreneurial free thinkers (what’s the French word for entrepreneurial). Israel may have a slightly higher number of those in the general population than average but we’re still talking exceptional not normal.

It’s become apparent that in reality “green” doesn’t sell (very much) in Israel: certainly not nearly to the extent that it does in some parts of Europe. Electric cars don’t have free parking, they pay the same road tax and so on: the government really hasn’t helped out to the degree that is happening in Europe.

I’m a small government kinda guy, I’m not asking for hand outs: I think Better Place offers a good enough deal now but the situation is not like Holland or Norway where EV’s are heavily promoted and subsidised by government fiat. The import duty tax break in Israel (which Better Place gets) is almost all there is and is worth less than government rebates in the UK or USA.

But the national security pitch appears to be getting no traction. In fact, the opposite may be true, the car’s local roots are proving a drawback. “I think Israelis have a thing for hating themselves and not appreciating things that come from Israel,” says Nitsan Avivi, editor of Auto magazine in Tel Aviv. “I think Aggasi [sic] made it look so dreamy at the beginning…we were always looking for the catch.” Indeed, the Hebrew press often appears to be rooting against Better Place. A recent column in Israel Hayom, the mammoth free-circulation daily owned by Las Vegas casino magnate Sheldon Adelson, listed only reasons not to get on board.

Treatment in the Hebrew press has been woeful and negative. In my cynical frame of mind I’d point out that car advertising is one of the largest single sources of income for the media in Israel and as Better Place haven’t done enough of that, they’ve not got any goodwill. This is unsubstantiated speculation on my part but you can see how it might work like this.

There was also a complete travesty of an article that appeared in Israel Hayom and seemed to be saying that because the weight of a battery does not go down as it was depleted (as the weight of fuel in an petrol burning car does) this somehow makes EV’s less efficient. Whoever wrote that hasn’t a clue about anything!

As an example, here’s a tweet stream by the environmental correspondent for the Jerusalem Post. She fires off a cost for the car that is wrong by 20% saying the car costs ₪150k when ₪120k is closer. For ₪150k you can buy it AND drive it for 4 years too. The fact that she doesn’t know the number and she covers Better Place indicates a huge problem! I really am not criticising Sharon Udasin at all: she’s a good reporter. It’s purely an example of where Better Place have failed to get any aspect of their offer out to the public.

I’m having very different conversations today: people are definitely thinking about it. The number one objection is long term viability of the whole company and that is ebbing after they confirmed a new finance round. Resale value of the car in 3 or 4 years is the only other unknown that people are genuinely asking about.

That Better Place have built this system and that it works so well is a staggering achievement. People genuinely don’t ask me if the system works any more: they can see I keep showing up on time to meetings!

But Better Place does not financially succeed or fail based on Israel. That never was the plan. Right now I think they’d rather have fewer customers but keep them all very happy (which they are doing) than drop the ball on customer service. Having visited China myself I can see how important that market really is. One small part of that market would dwarf Israel and make it completely irrelevant to the company’s long term success.

The other point I’ve been told about selling is the large fleets were only just starting to take cars but even when they commit to a large number like 125 in the case of Elco (very large company) they take 5 cars first and wait for feedback from those users: that can take 3 or 4 months. I have yet to find someone genuinely unhappy with the car or service and I really am looking and asking everyone.

Today Better Place is installing charge spots for owners of the Holden Volt plug in car in Australia. Their taxi trial at Amsterdam airport is being hailed as a success with 10 taxis averaging over 600km per day using one switch station. They certainly have a long way to go to profitability, but they are making many changes that make sense to me.

[tweet https://twitter.com/ZionistShark/status/271906637428707328]

About Brian of London

Brian of London is not the messiah, he's a very naughty boy. Since making aliyah in 2009, Brian has blogged at Israellycool. Brian's interests include electric cars, world peace and an end to world hunger. Besides blogging here, Brian of London now writes at the Times of Israel. Brian of London also hosted Shire Network News

comments

  • http://jpwhitenissanleaf.com JPWhite

    I find the media comment laughable that the EV is less efficient because it doesn’t loose weight as it runs the battery down as with a gasoline car/gas tank. Does that person not realize that the car does not get heavier when you fill it up? That’s one factor in favor of ev’s the fuel that gets added does not weigh anything (albeit a small factor).

    I find it interesting that customers in Israel are not upset with the car or battery stations, just the companies poor marketing of the vehicles. Similar feelings are harbored by LEAF owners in the states.

  • Ali

    Ok, the idea is wonderful, I think. It’s just that their cars (so far, I’ve only seen those Renaults) are just hideous.

    • Jerry996

      They don’t seem so awful from their photos. They remind me of a Toyota Carolla.

    • rachel in NJ

      I saw the Fluence in person at the dealer in Jerusalem while visiting Israel earlier this month. It is adorable and shiny, sporty but classy. Had hoped to test drive it but the dealer did not allow because we do not yet live in Israel. Prices seem reasonable compared with similar cars in Israel and the benefits it’s designed to offer. Also saw the battery changing stations on the road along Yam Hamelach and — amazingly — also in the parking garage at Mamila.

      • http://www.israellycool.com/author/brianoflondon/ Brian of London

        Feel free to get in touch with me next time you’re here and I’ll do what I can to get you a car to drive!

  • tom

    I would even drive a Renault, not liking the car-brand at all, but please, bring this to greater Europe already!!!

  • Jerry996

    I wonder what the Chinese response is to robotic battery switching? Perhaps it would be clever for Better Place to have an alternative, more labor intensive and machine aided (such as a forklift) battery-switch method for countries such as China with a large labor force.

  • mzk1

    I think the people who want XP are smarter, except for the memory limitation. As a programmer, I find the newer OS’s difficult in that they are too user-friendy – a.k.a. idiot-proof. I should be able to put a file whereever I like. I still often find UNIX command lines preferable.

    Regarding cars, there has been a change in Israeli culture; they are no longer cosidered a luzury – almost everyone has one. Plus, althoguh the tax laws are changing, company cars with the gas prepaid are not uncommon.

    But there are still many, like myself, who consider an automobile a luxury we can’t afford; it’s a small country and mass transit is heavily subsidized – and the taxes on cars are astronomical, way over 100%. By the way, there are plenty or people with internet and large families.

  • rachel in NJ

    Thanks for your offer. I did some more thinking and researching after reading your article. Perhaps entry into the short term rental market would be easier. I would have jumped at the chance to rent such a vehicle had my rental car company offered that…No investment, excitement of trying something new, no need to pay for gas, no need to fill up the tank right before dropping the car off to avoid being overcharged for refill, and, if you’re on vacation as I was, time to adjust without the pressure of usual routines! From the company’s perspective, the Better Place cars should cost them less than gas fueled cars (important since rental cars undoubtedly have relatively short life spans). Furthermore, renting to vacationers offers high levels of visibility in Israel, as vacationers drive the highways, visit many sites and visit with different friends and relatives (many with the typical Israeli thirst to know and discuss new technology even if they are not ready to buy it). Plus, renters from abroad go back to their countries and become ambassadors for the company and the technology.

  • Brian or Ra’anana

    Is there a map of Battery Switch Stations in Israel? I’ve just spent 20 minutes looking at Better Place’s websites and Google and found everything but that. It’s everyone’s first question and therefore should be Better Place’s first priority.

  • Jerry Yurow

    Nice interactive map, @zionistshark