Rising Fuel Prices will Prompt More Consumers to Consider EVs
A new survey released recently by Deloitte shows that 78% of consumers in the United States would consider purchasing an electric vehicle (EV) when fuel prices reach $5.00 per gallon. According to the new study, "Gaining traction: Will consumers ride the electric vehicle wave?," the higher the price of fuel, the more interested consumers are in EVs.
"Offsetting the fuel factor is the finding that the better the fuel efficiency of internal combustion engine (ICE) vehicles, the less interested consumers become in EVs," said Craig Giffi, vice chairman, Deloitte LLP and U.S. automotive practice leader. "A total of 68% of consumers in the U.S. are less likely to consider an EV if they are able to find ICEs with a fuel efficiency of 50 miles per gallon."
"For mass adoption, automakers in the U.S. will be challenged to price electric vehicles to meet the expectations of consumers and still make a profit on them," said Giffi. "U.S. consumers are not likely to pay any sort of price premium for EVs. Therefore, government incentives are very important to the purchase decision."
More than half of U.S. consumers surveyed are not willing to pay any price premium for an EV compared to a regular car (ICE) while only 8% are willing to pay a price premium of more than $3,000. Moreover, the overwhelming majority of these consumers (77%) expect to pay less than $30,000 net of government incentives.
Currently, hybrids and EVs represent a tiny fraction of total cars on the road globally. The adoption of all forms of green vehicles—hybrids, EVs, etc.—will be significantly influenced by government policies that will heavily shape the portfolio mix of powertrain technologies in each country. These policies will likely be driven by a number of factors, from stricter carbon emission standards to independence from foreign energy.
Additional findings from the Deloitte survey include:
- Consumers in the United States are aware of EVs. More than half of American respondents say they are at least somewhat knowledgeable about EVs, with 11% extremely or very knowledgeable. Among potential first movers, 37% rate themselves as extremely or very knowledgeable about EVs.
- For roughly 90% of respondent's convenience to charge, range, and cost to charge are all extremely or very important electric vehicle (EV) considerations.
- The vast majority of respondents have requirements that are not currently met by pure EVs in the market today, including range of up to 300 miles (63% of respondents; charging time of two hours or less (60% of respondents; and widespread availability of public charging stations (53 to 77% of respondents).
- Potential first movers in buying or leasing an EV in America describe themselves as environmentally conscious, tech savvy, trendsetters and politically active. These early adopters are generally between the ages of 18 to 34 years old (59%), educated (38%) with a bachelor's degree or higher, male (60 percent), and affluent (43% have incomes greater than $50,000).
- Most American consumers surveyed rate EVs as better than ICEs in their impact on the environment (78%), availability of government incentives (66%), and cost to operate (60%). However, ICEs rate better in their range before refueling or recharging (59%), purchase price (58%), and convenience to refill or recharge (56%).