Better Place, the Israeli-based startup that aimed to revolutionize the electric car industry, has filed for bankruptcy following a management shakeup and the closing of its U.S. and Australia operations earlier this year.
The company's CEO Dan Cohen said in a statement released over the weekend:
Unfortunately, after a year’s commercial operation, it was clear to us that despite many satisfied customers, the wider public take up would not be sufficient and that the support from the car producers was not forthcoming.
Better Place was founded by Israeli entrepreneur Shai Agassi to solve the limited range of battery-powered electric vehicles. As I’ve noted before, the limited range of today’s batteries has resulted in, the fear an electric vehicle will run out of juice and leave its driver stranded. It’s been one factor that has slowed EV sales.
Agassi’s vision was to build up a network of EV charging spots and battery-switching stations, which would allow drivers to swap out a depleted battery for a new one within minutes and extend the car’s range.
The audacious idea appeared to gain some traction in markets like Israel and Denmark, where EV sales are gaining momentum.
Better Place, once valued at $2.25 billion and a darling among investors who plowed about $850 million into the company, wasn't able to make its concept work in the United States or Australia. Better Place went through several leadership changes in recent months and in February officially .
And, it turns out, what little support it did have in its home country of Israel still wasn't enough to make it commercially viable.
Israel looks like a great market for electric cars, as Marc Gunther noted in a detailed analysis of Better Place. The country is small, its population is concentrated around Tel Aviv and Jerusalem and gasoline is pricey at $7.50 a gallon.
And yet, the company has managed to get about 1,000 of its EV cars on the road, signed only one automaker--Renault--as a partner, while ratcheting up at least $500 million in losses. The concept would really only work if multiple automakers had designed cars for battery swapping and entire nations, like Israel, adopted the idea and technology.
Instead, the company grappled with rising costs and regulations as well as increasing competition from other electric car companies, such as Tesla Motors.
What's unclear is what will happen to those folks who do own the Renault electric car and use the battery swapping stations. Better Place has an installed network in Denmark and Israel.
Photo: Better Place
This post was originally published on Smartplanet.com