A new survey released recently by Deloitte’s Global Manufacturing Industry group shows that mass adoption of electric vehicles is still a distance away. The survey, conducted among 4,760 Europeans in Belgium, France, Germany, Italy, Spain, Turkey and UK, comes on the heels of the 81st International Motor Show which took place in Geneva earlier this month, where a number of automakers showcased various green technologies.
According to the survey, only 16 per cent of European consumers identify themselves as “potential first movers,” while 53 per cent say they “might be willing to consider” and 31 per cent say they are “not likely to consider” purchasing or leasing an electric vehicle.
“Mass adoption of electric vehicles will be significantly influenced by a number of factors, including rising fuel prices, advancements in internal combustion engine vehicles and the availability of government incentives,” said Craig Giffi, Deloitte Global Automotive Sector Leader.
“While interest in battery electric vehicles is growing, with 69 per cent of European respondents having identified themselves as either potential first movers or as might be willing to consider an electric vehicle today, current market offerings generally fall far short of consumers’ expectations for driving range, charging time, and purchase price. As a result, we estimate only one to two per cent of these consumers actually adopting battery electric vehicles by 2020.”
The survey shows that there is a tipping point in terms of fuel prices influencing consumer adoption of electric vehicles.
Sixty three per cent of the European consumers surveyed say they are “much more likely” to consider an electric vehicle if the cost of fuel rises to €2 a litre. But, at the same time, if fuel efficiency reaches more than three litres per 100 kilometres in ICEs, they would be less willing to purchase an electric vehicle.
“For mass adoption, automakers will be challenged to price electric vehicles to meet the expectations of consumers while maximising their margins,” said Martin Hoelz, Deloitte Global Automotive Sector Affinity Group Leader. “European consumers are not likely to want to pay a high price premium for electric vehicles. This means that incentives such as tax reductions and exemptions, as well as bonus payments, will continue to be very important to the purchase decision.”
The majority (57 per cent) of respondents who say they may be willing to consider an electric vehicle expect to pay the same or less for an electric vehicle than they do for a regular car: only about a quarter (24 per cent) among the same group say they would be willing to pay a price premium of more than €1,500. Moreover, the majority of these consumers (58 per cent) expect to pay less than €15,000 net of government incentives.Currently, hybrids and BEVs represent a tiny fraction of total cars on the road globally.
The adoption of all forms of green vehicles – hybrids, BEVs –will be significantly influenced by government policies that will heavily shape the portfolio mix of powertrain technologies in each country as discussed in DTTL’s report, A New Era, Accelerating Toward 2020 – An Automotive Industry Transformed. These policies will be driven by a number of factors from stricter carbon emission standards to independence from foreign energy.
Additional findings from the survey include:
“Potential first movers” in buying or leasing an electric vehicle described themselves as being highly concerned about the environment, politically active, and trendsetters and tech savvy. Half of the respondents in this group were between the ages of 18 to 34 (50 per cent), more than half (57 per cent) male, and almost half (46 per cent) held a bachelor’s degree or higher.
In Germany and UK, “potential first movers” were less sensitive to fuel prices and much more willing to pay a premium for EVs than “potential first movers” from other countries.
More than 80 per cent of European consumers surveyed said that convenience to charge, range, and the cost to charge were all “extremely” or “very important” considerations when buying or leasing an electric vehicle.
Three-quarters of European consumers surveyed (74 per cent) said that before they would consider purchasing an electric vehicle, they would expect it to be able to travel 480 kilometres – much higher than what is currently available.
The full useful life of the battery as well as ease and cost of switching batteries are important factors to European consumers as they begin to contemplate the total cost of ownership.
More than two thirds (67 per cent) of respondents said if they were to purchase an electric vehicle, two hours was the longest they would be willing to wait to fully recharge the battery.