Electric cars get more than their share of press these days—just consider the Tesla Roadster or the Chevrolet Volt. But a quiet startup in California may end up beating its more heralded competitors to the punch, bringing the first fully electric sedan to the US market within 18 months. It would be the first Chinese-made car sold here as well.

Miles Electric Vehicles was founded by multimillionaire Miles Rubin in 2005. He’s been an environmental activist for decades, but earned much of his fortune after selling Polo Ralph Lauren Jeanswear, which he founded in 1990, as well as another apparel group. With deep connections in Chinese manufacturing, Rubin anticipated that the Chinese would make cars one day—and he knew they already made a large portion of the world’s battery cells. The connection seemed obvious.

Miles Electric Highway Speed Vehicle
Hafei Saibao 3

The base vehicle for the Miles Highway Speed vehicle (top) is a Hafei Saibao 3 (bottom). The Hafei Saibao is a compact sedan built in Harbin, China. Hafei Automotive Group designed the Saibao to meet global safety standards.

The company started out selling neighborhood electric vehicles, a business it still maintains. Early buyers of these low-speed sedans and trucks include cities, universities, electric utilities, NASA, the US Navy, and the National Parks Service. But it’s the prospect of a “real car” that motivates Rubin—a car that families could use for daily travel. Toward that end, Miles announced in February it had raised $15 million, with Rubin reportedly kicking in an additional $30 million himself.

In an exclusive two-hour interview—held in Miles’ offices opposite the Santa Monica Airport—president and CEO Kevin Czinger discussed the company’s strategy, its market positioning, and the development of its Highway Speed model (formerly known as the XS500). He joined Miles this April after stints as a senior executive at Goldman Sachs & Co., the Webvan Group, and Global Signal. He was also active at Benchmark Capital and Fortress Private Equity Funds.

The Core Challenge: Cost

Perhaps the most daunting challenge to launching an affordable electric car into Western markets is simply cost: It takes hundreds of millions of dollars to design and build a car—any car—from scratch. So unless you’re already a global automaker, you have to base the car on an existing vehicle platform, and contract out the manufacturing—just as Tesla did by re-purposing elements of the Lotus Elise in its Roadster and hiring Lotus to build it.

Working with the Chinese Automotive Technology & Research Center (CATARC), Miles surveyed vehicles from dozens of companies now making cars in China. Their goal was to identify one that could be manufactured to Western quality standards, adapted to electric drive, and reliably “homologated”—meaning it would pass the myriad regulations and tests required by multiple agencies before a car can legally be sold in the US and Europe. Crash safety would be a major hurdle. In Europe, thanks to YouTube, Chinese cars are already fighting the reputation of being highly unsafe in crash tests (see videos in “Crash Test Disasters” at bottom of linked story).