Farkas: Electric Car Industry Needs 'a Little' Government Assistance

Friday, 22 Mar 2013 03:46 PM

By Dan Weil and John Bachman

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Michael Farkas, CEO of the Car Charging Group, approves of the recent plan announced by President Barack Obama to use money from federal oil leases to help finance electric car research.

“It’s very exciting. We’re at a point where we need a little assistance from the government to the industry,” Farkas told Newsmax TV in an exclusive interview. “This is an industry that really benefits everybody. Think about the benefits of not having to affect the environment, think about not having to use fossil fuels. These are things that are possible within our lifetime, and government assistance will help make it happen.”

While battery-powered cars are still more expensive than their gasoline-powered brethren, government assistance in the U.S., China and Europe is helping the electric car industry progress, Farkas said.

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“As more cars are developed, it’s cheaper to produce these cars,” he said. “With economies of scale you have commoditization, commercialization. We really salute the president for his efforts, which are very important for this industry to grow.”

And what of the criticism that the electric power in the cars is produced using oil and gas? Farkas says it’s all about subsidies.

Editor’s Note: Put the World’s Top Financial Minds to Work for You

Oil prices are cheap in the U.S. compared with the rest of the world, he notes. “And a lot of that has to do with certain subsidies that the oil and gas companies receive and certain help that they’ve been receiving for more than 100 years,” Farkas maintains. “It’s time now for the government to not only assist the oil and gas companies, but to assist the battery-powered companies so we can have electric cars. The benefits to America, to be independent of fossil fuels, not to be affecting the environment, it’s very important.”

And where would the electric car market be in the U.S. without the $7,500 tax credit available for purchasing an electric car?

“On the low end of the market, it would definitely affect things,” Farkas states. “On the high end of the market, I don’t think it would really make a difference.”

We’re going through a natural technological progression from internal-combustion-engine cars to battery-powered cars, he says. It’s just like the move from analog to digital that took place for cell phones.

“It’s more efficient, and ultimately the technology is there,” Farkas notes, adding that cars are being tested that can go over 300 miles on a single charge.

Comparing a Tesla Model S with a BMW M5 or Mercedes E Class AMG, “right now the Tesla is cheaper, even taking into consideration the $7,500, and it outperforms its peers,” Farkas says.

He compares electric cars to flat-screen TVs. “When I bought my first flat-screen TV, it was over $10,000. Now you can get the equivalent for roughly $700 or $800.”

Editor’s Note: Put the World’s Top Financial Minds to Work for You

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