Study: Most Consumers Remain Unwilling To Purchase EVs

A new study released by the Indiana University School of Public and Environmental Affairs (SPEA) asserts that most car consumers remain dubious about the merits of purchasing an electric vehicle (EV).

Consumers, however, in major metropolitan areas polled including San Francisco, Chicago and Boston are more receptive to the idea of buying an EV say the study’s researchers. More than 2,300 adult drivers were surveyed in 21 large U.S. cities in the fall of 2011.

The study found that what consumers perceived as drawbacks of EVs, like limited driving range, high retail MSRPs and the “inconvenience of recharging batteries” outweighed the advantages of owning an electric vehicle.

“Although many engineers, environmentalists and politicians are enthusiastic about electric vehicle technology, this survey reveals that new car buyers, based on early impressions, have little interest in purchasing plug-in vehicles,” said John D. Graham, dean of the School of Public and Environmental Affairs and a co-author of the study.

While plug-in electric vehicles offer the advantage of bypassing the gas pump, that benefit isn’t attractive enough to offset the perceived disadvantages, the study found.

Graham said new car buyers typically keep their vehicles only three to five years – not long enough for fuel savings to make up for the premium purchase price. According to the study car buyers also typically do not consider the costs of operation and upkeep but tend to focus more heavily instead on the sticker price of the car.

The survey found the early adopters who are likely to buy plug-in electric vehicles are predominantly highly educated, male, concerned about the environment and worried about American dependence on foreign oil. They are also more likely to have previously owned a hybrid vehicle.

“It’s helpful to know this information, because it can help manufacturers identify their early car-buying population, and it also reveals which consumer types are not being reached by current marketing campaigns,” said the study’s author, assistant professor in SPEA, Sanya Carley.

In the year-plus since the study was completed the public profile of EVs has seen a number of positives.

Tesla Motors Model S received Car of the Year from Motor Trend magazine, as well as Automobile of the Year from Automobile. Tesla also has begun to put in place its Supercharger network, which will allow Model S drivers to take advantage of the car’s extended range without having to wait hours between recharges. Additionally, Chevy Volt drivers have reached the milestone of collectively driving more than 100 million all-electric miles, with Nissan Leaf drivers boasting a similar feat.

Graham acknowledges that EV manufacturers are making strides in overcoming perceived negatives of electric cars, by lowering or incentivizing prices and expanding charging networks. Nevertheless, these achievements may have had little positive impact on consumers’ minds since the study was completed.

“Based on sales data of electric vehicles, and subsequent surveys, we would be very surprised if the result would be much different today than in August 2011,” Graham said in the New York Times.

Graham cites confusion of information as helping keep consumers wary of EVs.

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“We found substantial factual misunderstandings of electric cars in our sample of 2,000. In some cases, the misunderstandings would cause one to be more pessimistic about the vehicle than they should be. And in other cases, it would cause people to be more optimistic than they should be,” he said.

The apparent misgivings and apathy of consumers toward EVs discovered by the study isn’t surprising to former GM Vice Chairman Bob Lutz, however.

“The electric vehicle market is moving exactly as I have consistently predicted,” said the purveyor of extended-range GM light duty VIA Motors trucks. “I have always maintained that pure EVs will have a limited future until there are cars selling for $30,000 with a reliable 300-mile range. Extended-range EVs (E-REVs), like the Chevrolet Volt, overcome the range problem, but at a steep price premium.”

On the brighter side

The study revealed a possible benefit, but perhaps at the expense of success for EVs.

The concern over an electric vehicle’s driving range, or range anxiety, may serve as an unforeseen boost to the hybrid vehicle market. According to researchers consumers are more interested in buying a hybrid because of the added range a hybrid’s gas engine gives, suggesting that there may be better market potential for cars like the Volt, and Toyota’s Prius Plug-in.

2013_Chevy_Volt_WG

The burden of improving the attractiveness of EVs isn’t solely the domain of car dealerships and manufacturers according to Graham.

“Policy makers also need to develop more realistic expectations about the pace of market acceptance of plug-in technology,” Graham said, “and they may need to retain policy incentives for plug-in vehicle purchases longer than they originally anticipated would be necessary.” For example, the University notes that President Barack Obama has proposed increasing the federal income tax credit for buying a plug-in vehicle and making it effective at the time of purchase rather than the end of the tax year.

The authors said one of the more interesting findings in the study was the city-by-city variation in intent to purchase an electric vehicle. The interest of survey respondents in buying a plug-in electric vehicle was rated on a 10-point scale; the average score was 2.67.

Cities with the highest intent-to-purchase ratings were:

San Jose/San Francisco — 3.72

Chicago – 3.25

Boston – 3.03

Seattle – 3.02

Los Angeles – 3.01

Cities with the lowest ratings were:

Dallas/Fort Worth – 2.17

San Antonio – 2.21

Indianapolis – 2.21

Detroit – 2.24

Nashville – 2.36

The study’s findings were published online by the journal Transportation Research Part D: Transport and Environment, in advance of its January 2013 issue. Other co-authors are Rachel Krause and Bradley Lane of the University of Texas at El Paso.