Credits fuel small electric vehicle sales

March 25, 2011
| By Pete Daly |
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Bob Hahn “had a real good show” exhibiting his Tomberlin street-legal, low-speed electric vehicles at the Ultimate Sport Show at DeVos Place in mid-March. Now if only he could find a bank willing to loan him up-front capital for large commercial orders from companies in the region.

“I don’t get these banks. It’s like they’re not in support of small business,” he said.

Hahn, who owns Lakeshore Electric Cars in 430 S. Waverly in Holland, is one of only 10 Tomberlin dealers in the U.S. His business is across the street from a Meijer parking lot that has re-charging stations for the new hybrid-electric vehicles such as the Chevy Volt — but Tomberlin electric vehicles are recharged at a regular household 110-volt outlet.

Located in Augusta, Ga., Tomberlin assembles Asian-made components into low-speed electric vehicles that are legal for use on streets where the maximum speed limit is 35 miles per hour or less.

According to the Insurance Institute for Highway Safety, the National Highway Traffic Safety Administration established a limited set of safety standards in 1998 for low-speed vehicles, or LSVs, designed primarily for shopping, social and recreational use. To qualify as an LSV, it must be a four-wheeled vehicle with a top speed of at least 20 mph, but it cannot exceed 25 mph. Such vehicles must be equipped with headlamps, taillamps, brake lights, reflectors, mirrors, parking brake, windshield and seatbelts, but they are exempt from most other federal safety standards that apply to motor vehicles.

Although they resemble golf carts, Hahn’s Tomberline sales rep, John Hancock, is adamant that they are not. For example, he said, they have hydraulic brakes like an automobile and sturdy frames.

Hahn sells the Tomberlin E-Merge and Vanish lines of electric LSVs, both of which are street legal and have a 48-volt AC drive system and multiple high-capacity, deep-cycle lead-acid batteries. The Vanish is a four-wheel-drive sport-utility vehicle designed for use in rough terrain, which got a lot of attention at the Ultimate Sport Show.

Both the E-Merge and the Vanish qualify the buyer for a federal Qualified Plug-in Electric Vehicle tax credit, equal to 10 percent of its cost, up to a limit of $2,500. Hahn said the Vanish has a starting price of $13,000; the standard E-Merge sells for about $8,600.

Hahn worked in various technical capacities at Ford dealerships in Ohio and Michigan from 1979 to 1998. He started his business, originally called Lakeshore Custom Golf Carts, in Holland around 1999. When Tomberlin began production of electric vehicles in 2006, Hahn began selling them and changed his company name to Lakeshore Electric Cars.

Hahn also sells the stubby little Wheego electric car, which is legal for highway use and is not made by Tomberlin. It, too, is comprised largely of parts made in China, and it qualifies for the same tax credit available to Chevy Volt buyers, up to a maximum of $7,500.

In 2009, the federal tax credit for buyers of LSVs was much higher — up to almost $4,250 on an E-Merge, according to Hahn. He said he sold about 123 of them that year. Then the tax credit for LSVs dropped to 10 percent starting in 2010; that and the effect of the recession pushed sales down last year to about 74 units.

“If the tax credit was like it was in 2009, I would have had to hire three, maybe four people,” said Hahn.

However, he figures 2011 “should be a phenomenal year” for Lakeshore Electric Cars, especially in sales of the Vanish. He said the Michigan DNR is considering buying some, as well as some construction companies. In the past, those organizations have used golf carts, he said.

Financing is a challenge, however. Hahn said he would have to pay Tomberlin up front if a company or organization like the DNR wanted to place a large order for 10 or so. He has been making the rounds at the banks, trying to find the credit to cover those up-front costs.

Hahn said many of his previous customers for his electric LSVs from Tomberlin have been summer residents of the shoreline area.

Hancock said “people will buy them as a pleasure vehicle” or for a short commute to work or quick trips to the supermarket.

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