After surprise ouster, Better Place hopes new CEO will recharge electric car firm’s fortunes

The appointment of a new CEO for electric car innovator Better Place could signal a major change in the company’s business strategy, auto industry insiders and analysts say.

On Tuesday, the company’s board of directors announced that it would remove company founder Shai Agassi from the company’s top job, replacing him with Evan Thornley, who heads the company’s Australian arm.

The decision was greeted with surprise. Agassi, an energetic Israeli entrepreneur, had been the face of the company from its inception.

But experts say his removal was not unexpected given the fact that after billions of dollars of investment the company’s sales have not taken off.

In a recent article in the Israeli business daily Globes, Shmuel Charlap — chairman of Calmobile, the Israeli importer of Nissan and Renault vehicles and a Better Place partner — criticized Agassi’s sales approach.

Agassi’s strategy, in which the company developed its own models with several car companies, including Renault, diminished the manufacturers’ brand recognition by emphasizing that of Better Place at their expense, he wrote. In addition, Better Place’s battery changing stations were likely to become outmoded in the very near future, he wrote, because of improvements in technology for direct recharging of batteries from electrical wall sockets, and increases in battery life and range.

An unidentified automotive industry executive quoted in the business paper Calcalist said Agassi had erred by offering Better Place technology with a limited number of models, most notably the Renault Fluence. “Not everyone wants the same small car, and they are not willing to take a chance on a new technology when the cars offered by Better Place cost the same as a regular gasoline-powered car,” the executive wrote.

The appointment of Thornley, who has run Better Place Australia since 2009, seemed at least partly aimed at addressing those concerns. He helped create a company called EV Engineering Ltd., which is working with a wide consortium of manufacturers in Australia to develop battery-switchable electric cars. Among EV Engineering’s partners in Australia are companies like Bosch, Continental, Air International and Futuris, among others, all of which manufacture components for the models being developed. Those partnerships will allow the company to quickly ramp up mass manufacturing if that becomes necessary.

Idan Ofer, chairman of Better Place’s board, alluded to this experience when he announced the replacement. “In his four years as CEO of Better Place in Australia, Evan has built an impressive track record, particularly around establishing a strong set of industry partners there. Evan brings the right combination of entrepreneurship and coalition and team building to take Better Place to the next level,” Ofer said.

The change in management might also signal a change in strategy in an effort beef up the anemic sales of Better Place vehicles. So far, only a few hundred have been sold in Israel, one of Better Place’s main markets. Thornley has been working on developing luxury vehicles for battery technology – specifically the Commodore, manufactured by GM’s Australian subsidiary, Holden.

The thinking among Better Place executives, the experts say, is that consumers may be prepared to pay a bit more for a larger vehicle, instead of getting a “regular” car at a “regular” price, with a greater willingness to take a chance on the new technology if the vehicle provides them with other rewards and incentives – such as being able to get a luxury-class vehicle.

In another criticism lobbed at Agassi by industry insiders, Better Place has so far failed to sign up the large numbers of fleet owners that the company expected to buy vehicles for their employees, a large segment of the Israeli car market.

However, just days before Tuesday’s announcement of Agassi’s departure Better Place said that it had completed a leasing arrangement with Albar, a large Israeli firm. For about $500 a month, customers can get a Better Place vehicle, with full battery switching and recharging service. The deal was seen as a breakthrough for Better Place, giving the company a first foothold in the Israeli leasing market.