Driving Down Electric Avenue

By Tobin Smith

Now that "going green" is mainstream, will electric cars follow? After all, some of the first automobiles produced more than 100 years ago were electric-powered, and many of us have used electric carts to chase golf balls around picturesque courses for decades.

Then consider the clamor for the gas-electric hybrid Toyota Prius -- the poster child for the politically correct, eco-conscious set.

More than 181,000 Priuses were sold in 2007, and Toyota (TM) sold its one-millionth Prius in April, 11 years after its introduction. Toyota dealers can't keep them on the lot with 90-day waiting lists as drivers of every stripe try to find relief from high prices at the pump.

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Other automakers are also riding the hybrid bandwagon, though none have matched the success of Toyota thus far.

Even though we're seeing some relief in gasoline prices, the chatter about electric cars is growing -- especially now that hybrids have primed the pump.

Though there are manufacturers that have been producing electric cars on a smaller scale for years, two companies are getting the most ink these days, and they are as different as night and day: Tesla and General Motors (GM).

The new Tesla Roadster is starting to be delivered to the eco-elites willing to pay for this $109,000, two-seat, high-performance roadster. While the company is now pushing a limited number of cars out the door, it still faces challenges as it tries to add a five-door sedan to its lineup -- the $60,000 Model S (formerly known as the WhiteStar) -- that it hopes to sell in larger volumes starting in 2010.

Will The Volt Drive GM To Success?

After being made a pariah in the documentary "Who Killed the Electric Car?" about its EV1 electric car, it's entirely possible that General Motors may be the first company to make good on the promise of the high-volume production electric car.

If you caught any of the Beijing Summer Olympics, you probably saw one of GM's commercials featuring the Chevy Volt concept car that is scheduled to hit showrooms starting in 2010.

When it arrives -- and if it lives up to its promise -- the Volt will be as iconic for Chevrolet as the Corvette.

Even though the Volt will have a small four-cylinder motor in the engine bay, it won't be used to drive the wheels, but rather as a "range extender" to recharge the batteries. GM's current target is for the Volt to hold enough power from an overnight plug-in charge to go 40 miles without using gasoline at all -- a range that would cover 80% of American commutes.

The General plans to build 10,000 the first year of production and ramp up to 60,000 the next.

Frankly, I can't wait to see one of these cars on the road. And while it would be nice if GM were ready to challenge the Prius production numbers right out of the gate, it's more important to get things right than to break sales records.

I think most Americans would welcome the sight of a strong GM taking the lead in electric cars. In fact, the cheers could be as loud as those for eight-time gold medalist Michael Phelps if GM manages to pull this off.

Toby Smith is the Editor of ChangeWave Investing.