Norway's Think to Produce,

DETROIT – Norway's Think Global AS, with backing from U.S. venture capital investors, plans to produce and sell a small all-electric car in the U.S. that could go as far as 110 miles when fully charged – fresh evidence that the race to woo American consumers with electric cars is heating up and drawing interest from the same investors that helped build Silicon Valley.
Norway's Think Global plans to launch an electric car, called the Think City, in the U.S. in 2009.

The Oslo-based electric carmaker, which recently set up a U.S. office in Menlo Park, Calif., is trying to determine what geographical areas to focus its sales activities on, with an aim to launch the car – the Think City – in 2009. Think, a Ford Motor Co. unit until the U.S. auto maker sold it to a Norwegian company in 2003, is also searching for a site in the U.S. and Mexico to assemble the car.

Jan-Olaf Willums, Think Global chief executive officer, said Think plans to sell the City, to be priced less than $25,000, in densely populated cities because of the car's limited range. The car is just hitting the market in Norway, Sweden and Denmark where a typical user drives the vehicle for a relatively short commuting distance and plugs it into an electric outlet in his garage to charge it overnight.

"What we have is a city car so we would focus on big cities," Mr. Willums said, noting that Think may focus on markets on the West Coast such as San Francisco and Seattle. "But we think there's an opportunity for us also on the East Coast, or any city in the U.S. that wants to encourage use of pollution free electric cars. We don't care if it is in Texas, we will be there."

Mr. Willums declined to estimate U.S. demand for the City car, but Ray Lane, managing partner of venture-capital firm Kleiner Perkins, Caufield and Byers, which has invested in Think, believes Think could eventually sell as many as 30,000 to 50,000 City cars a year in the U.S. once production ramps up and a sales network for the model is fully established. In Norway, Think is rushing to boost production to 10,000 a year this year to meet demand in Europe.

According to a Think spokeswoman in Oslo, Think Global has raised about $95 million from an array of investors in Europe and the U.S., including GE Energy Financial Services and RockPort Capital Partners. In addition, the company also received backing, which Mr. Willums described as "substantial," from Kleiner and RockPort to set up Think's North American unit.

Mr. Willums said Think's North American executives, among other tasks, are currently looking for a site to produce the City. "Because of the dollar's extreme weakness, it doesn't make sense to ship cars across the Atlantic." The Norwegian executive said Think would like to see which state and city could provide the "best deal," referring to investment incentives such as tax breaks.

In addition to the City, Think plans to add to its product lineup in late 2010 in Europe a second all-electric vehicle: the Think Ox, a five-seat car-SUV crossover. Using currently available battery technology, the car has a driving range of about 150 miles when the vehicle is fully charged. A U.S. launch is expected to follow shortly after, Mr. Willums said.

Kleiner, one of the key investors for Think, is perhaps Silicon Valley's best-known venture-capital firm and a backer of household tech names such as Netscape Communications, Amazon.com Inc. and Google Inc. Kleiner and other venture-capital investors who helped build Silicon Valley are now clamoring to back the race to develop and market an electric car in the U.S., investing in little-known upstart companies such as Aptera Motors Inc. and Phoenix Motorcars Inc., both southern California companies. Tesla Motors Inc., the high-profile company that is close to shipping a $98,000 electric sports car, has raised $105 million from investors, including VantagePoint Venture Partners, Technology Partners, and Draper Fisher Jurvetson.

Think's planned entry into the U.S. market follows decisions by General Motors Corp. and Nissan Motor Co. and others to market electric cars with a small gasoline engine they describe as a driving "range extender." Those small combustion engines work as generators to feed electricity to the car's batteries when they run out.

Other companies, most notably Japan's Toyota Motor Corp. and Honda Motor Co., plan to go a different direction. The two Japanese auto makers believe battery technology has not advanced far enough to make electric cars practical and are focusing their efforts on making gasoline-electric hybrid vehicles, such as the Toyota Prius, more fuel-efficient and affordable. Toyota has said it plans to test the feasibility of an electric car with a range extender, however.

The Think City, when it hits the market in the U.S., will be equipped with three optional, high-powered batteries. U.S. consumers will be able to choose from what Think describes as a "sodium battery" system with active materials composed of sodium, nickel and iron, as well as from two types of lithium-ion batteries from two U.S. companies: A123 Systems of Watertown, Mass., and Enerdel. Enerdel is the joint-venture battery company owned 80.5% by Ener1 inc. and 19.5% by auto-component supplier Delphi Corp.

Write to Norihiko Shirouzu at norihiko.shirouzu@wsj.com

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