The evolution of city demographics and the need for affordable, efficient EVs could create a mass market for micro models in the US. By Will Girling
Micro electric vehicle (EVs)—four wheelers with a footprint equivalent to a two wheeler—are becoming an increasingly viable form of personalised zero-emission urban mobility. In Europe, manufacturers like City Transformer and Luvly are touting sub €20,000 (US$21,712) models as an affordable entry to e-mobility and a cure for congested cities.
But what about the US market? Historically, consumers have preferred bigger models over compact ones. In 2023, the best-selling internal combustion engine (ICE) vehicles were all pick-ups (the Ford F-Series, Chevrolet Silverado, and Ram 1500). In the EV segment, SUVs outsold every other category by thousands, in no small part because of the Tesla Model Y’s runaway success. Convincing customers that smaller is better could be tough.
Or perhaps not. Marcus Li, Chief Executive and Founder of Los Angeles-based Eli Electric Vehicles, believes that times are changing. “Americans are increasingly adopting compact and eco-friendly vehicles, as evidenced by the expanding micromobility market.” McKinsey & Co estimates it could be worth US$56bn by 2030. He tells Automotive World that his company’s Zero model—categorised as a low speed vehicle (LSV) or neighbourhood EV (NEV)—has already received “hundreds of reservations” ahead of its scheduled release in Q3 2024.
Balancing trade-offs
Although the Zero has yet to make its North American debut, Eli’s Chinese manufacturing partner began production of a European version in H2 2021, targeting customers in cities like Vienna and Amsterdam. At that time, Li didn’t consider the US market as an ideal starting point. However, with EV adoption now stalling in part due to lack of affordable mass production models, the tide could be turning. Despite President Joe Biden’s imposition of 100% tariffs on Chinese-made EV imports, Li tells Automotive World that LSVs have not been affected so far, although Eli will “closely monitor” the future implications.
The US version of the Eli Zero starts at US$11,990—substantially cheaper than the average EV price of around US$54,000—and seats two occupants. However, there are concessions: the micro EV’s 90-mile range is far below the 300-mile industry average. Combined with a top speed of only 25mph, practical use of the vehicle is restricted to short-range purposes. According to Li, this isn’t a problem: “Considering 75% of US car trips are less than ten miles, the Eli Zero’s max range can accommodate most daily trips.” The US range spec is 30% higher than the European model, reflecting different regional topography.
One of the biggest engineering challenges in developing NEVs, he continues, is balancing the trade-offs between size, range, and performance. At 70% smaller than a regular EV, three Eli Zeros could fit in a standard parking space, but reduced size means it cannot accommodate larger batteries and motors to enhance performance. As such, energy efficiency became a necessary guiding design principle.
The importance of energy efficiency
“Energy efficiency is pivotal as it directly impacts the vehicle’s range, operating costs, and environmental footprint,” says Li. He contends that conventional EVs are oversized, over engineered, and ultimately unsuitable for urban mobility. “For a single occupant EV, 95% of the energy is wasted on moving the vehicle’s own weight.”
Eli mitigates this problem in the Zero by incorporating a high energy density, 12kWh lithium-iron-phosphate battery. Combined with a smaller size (2,250mm x 1,380mm x 1,588mm) and lighter material spec—the frame is high-tensile aluminium—the company claims the Zero achieves more than 285mpge, making it around two-times more efficient than a conventional EV and ten-times better than ICE. Li states that this design also boosts acceleration and enhances the overall driving experience.
With energy efficiency also comes convenience and more affordable operating costs. Eli states that the Zero can be charged in approximately five hours using a standard 120V outlet or two to four hours from 220-240V. “This represents a paradigm shift: you can charge quickly almost anywhere,” emphasises Li. Furthermore, he estimates that it costs US$1-US$1.50 to fully charge, meaning the majority of US customers’ daily consumption would add up to just US$5 a month.
An untapped market
While the Zero is smaller than average, Li states that this does not mean compromised performance when driving in the city environments for which it was designed. The vehicle’s high torque makes it nimble like a two wheeler in cramped urban spaces, and the US’ Zero will include a collection of “upgraded enhancements” separate from its European counterpart. These include an anti-lock braking system and electronic parking brake, as well as several other features yet to be announced that will be firsts for the LSV class.
Beyond basic commuting, Li is confident that the Zero is suitable for “a wide array of applications” such as vehicle sharing, tourism, and last-mile delivery. “Our mission at Eli is to simplify daily trips, fostering stronger connections between people and their cities while reducing traffic congestion and pollution.” That objective could ultimately benefit everyone: easier driving and parking for individuals, more pedestrian-centric city landscapes, and subsequently reduced congestion and improved air quality.
A report by McKinsey & Co estimates that by 2050, 70% of the world’s population will live in a city, and players like Toyota are challenging innovators to realise the urban transport of tomorrow today. As a more affordable and cost effective entry point to EVs, the Eli Zero has the potential to make e-mobility an attractive proposition for urban populations in the US. However, LSVs and NEVs remain a relatively prospective market globally; at the time of writing, Eli has achieved three-figure sales numbers in Europe and the South Pacific.
Nonetheless, Li characterises the US as “untapped”, containing a total addressable market of 11 million micro EVs annually. Eli, he believes, has the technology and consumer knowledge to lead the national segment as it grows. “By introducing the Eli Zero, we aim not only to address current mobility challenges but also lead a sustainable transportation revolution that benefits individuals, cities, local businesses, and the environment.” It remains to be seen whether evolving city demographics gives the segment enough prevalence to displace US consumers’ established preference for larger vehicles.
