When two CEOs shake hands standing in front of a car, it's quite likely thousands of hours of work lay behind that moment. So it's time to applaud the transatlantic partnership of Amp Electric Vehicles of Cincinnati and Iceland's Northern Lights Energy, which is aimed at putting plug-in cars on the streets of a city that could really make use of them.
The car is an electrified Mercedes ML350, the first of a planned 1,000 SUVs that will be converted by Amp in the U.S. and shipped to Iceland, where NLE has signed up 50 companies leading companies to both convert to EV fleets and host charging stations.
Iceland is a perfect location for electric cars, because as NLE's CEO Gisli Gislason points out, electricity generated by the country's abundant geothermal resources is only three cents a kilowatt hour. The population is only about 319,000, two thirds of whom live in Greater Reykjavik (the capital city).
“It's a no-brainer,” Gislason told me. “Because of the very high import taxes on gas guzzlers, you'll be able to buy our Mercedes for about the same price as the gasoline version.” A pending federal rule now in committee and expected to pass by summer's end should clear away all sales taxes (called VAT in Europe) on electric cars in Iceland.
Prior to the Benz for Iceland, Amps conversions were of the Chevy Equinox, Pontiac Solstice and Saturn Sky. The economics are much better for the Equinox because the car is cheaper: $22,000 to $30,000, plus a $32,500 conversion cost. (The Benz is likely to cost more than $100,000.)
Amp CEO Jim Taylor said, “This is very gratifying for the troops. This day is the culmination of a lot of years of work by the Amp guys. Gisli went around the world for two years looking for available hardware, and he found it here.”
A confession: I suggested that Amp and NLE get together, precisely for the reason Taylor cites. Gislason was looking for cars, Amp had them — instant synergy. And, no, they didn't pay me anything — just a lot of goodwill.
The Icelandic deal is a shot in the arm for Amp, which has sold only about a dozen electric cars so far. Part of the reason is Amp's high cost in buying cars off the showroom floor and then converting them. It would be nice if companies like Amp could get deals to buy what are called “gliders,” minus engine and transmission. But Taylor said, “It's a tough challenge for the OEMs to put 10 vehicles or 100 vehicles aside — it's not worth it for them.”
Taylor sees Amp's future, outside Iceland, with “institutional buyers,” not individuals. He wants to sell to utilities and, a fast-growing market, rental car agencies like Hertz (which is on an electric car buying spree, says global EV leader Jack Hidary).
Iceland has, at most, 10 EVs on the ground right now, and not many charging stations. And, yes, it's still reeling from the 2008 financial crisis, which temporarily reduced auto sales by a massive 80 to 90 percent. The government took over the biggest dealerships, too. It's not over yet, but sales, and the economy, are beginning to recover. Go for it, Gisli.
Jim Motavalli is the author of the book Forward Drive: The Race to Build "Clean" Cars for the Future. You can e-mail him at firstname.lastname@example.org.