Atlanta Business Chronicle
By Urvaksh Karkaria
August 14, 2009

Wheego Electric Cars Inc. has raised $1.2 million as it readies itstwo-seater electric car to hit the streets next month.

The Atlanta-based startup, spun out from Ruff & Tuff Electric Vehicles(RTEV) in 2009, will initially sell the Whip as a low-speed or medium-speed vehicle.

As a low-speed/medium-speed vehicle, the Whip will be permitted to drive on streets with a maximum speed of 35 mph. Its sealed lead acid battery has enough juice to keep it moving about 40 miles on a single charge.

Once the Whip passes federal crash-testing requirements, it will be marketed as a full-speed vehicle – capable of zipping around at up to 65 mph. The full-speed version will have an lithium-ion battery – capable of reaching about 90 miles on a single charge – and a more powerful motor.

Electric cars play well with urbanites, who often have to maneuver in tight parking spaces. The fuel-free vehicles, once a niche marketed toenvironmentalists, is gaining broader appeal in the midst of a globalrecession and volatile gas prices.

The low-speed Whip is expected to retail for about $18,500, while thefull-speed version will go for about $28,500. Federal tax credits, however, will significantly reduce the sticker price.

Wheego, which raised the $1.2 million from existing investors, hopes toraise an additional $3 million to $5 million over the next two years to help pay for the Whip’s crash-testing process and to develop new vehicles, CEO Mike McQuary said.

“Crash testing is the big wild card,” he said. “You’re not sure how many iterations you have to do.”

Wheego has also applied for a roughly $10 million federal loan, said McQuary, a serial entrepreneur best know for helping launch Internet service provider MindSpring Enterprises Inc. In 1999, MindSpring merged with EarthLink Inc.

The full-speed version of the Whip is expected to hit the market by the middle of next year.

McQuary expects to sell about a 1,000 units of the low-speed version of the Whip in the first year and about 5,000 units of the full-speed version in the first year.

The Whip is being assembled at a plant in Ontario, Calif. Wheego plans to open additional assembly plants on the East Coast and the Midwest in the next two years, McQuary said.

The body panels and chassis are made in China, the guts of the car – including engine and drivetrain – is U.S.-made, while the battery is manufactured in Canada.

In addition to traditional auto dealerships, the Whip will sell via electriccar dealerships that have sprung up in about a dozen cities in the United States and carry models of electric cars not affiliated with major manufacturers.

Wheego expects to have an up to 50 dealer nationwide network by the time the full-speed Whip hits the road.

Developing a dealer network won’t be too expensive or time-consuming McQuary said.

“A lot of car dealers, given the duress that the auto industry has been under, have been looking for new opportunities,” he said. “Dealers have been very open.”