Car makers have made significant investments in developing electric vehicles (EV) but, despite their best efforts to promote this type of vehicle, the EV market is still taking off only slowly. Among the key barriers to take-up are consumers’ misconceptions about EVs - specifically, concerns about EVs’ limited range, high cost and lack of charging infrastructure.
How can your business market EVs to consumers more effectively? Setting out the facts about what EVs do and don’t offer - and challenging common assumptions - is an important step in making the sales message more effective.
Assumption: “You can’t go very far in an electric car” - Fact: Electric vehicles are perfect for city journeys.
Range anxiety should not be an issue if manufacturers tell users clearly what EVs can and cannot do. Current battery technology equips EVs perfectly for urban use: the average EV has a range of around 100 kilometres while the average trip in a metropolitan area is 15 to 25 kilometres. Car-sharing schemes, which operate in urban areas, already recognise this fact. Many are accelerating EV take-up within their fleets, as seen in Daimler’s Car2Go or BMW’s DriveNow.
EV marketers need to tell consumers exactly what they will get with an EV: not a multi-purpose vehicle for all drives, but a comfortable and clean alternative for the daily commute. For longer weekend or occasional vacation journeys, consumers will need to own, rent or share a second car or use public transport. Design can send a powerful signal - looks alone declare Renault’s best-selling EV, the two-seater Twizy, to be a dedicated city vehicle.
Assumption: “There aren’t enough EV charging points” - Fact: Installing your own EV charge point is a practical option.
It will take time to establish an appropriate public charging infrastructure for EVs. Pilot projects show that most EV charging takes place during the night at home or during the day at work, so this is where charge points are urgently needed. However, installing a personal charge point is now a practical option for consumers. A convenient and reliable EV charge point, with a life span of at least 15 years, costs less than €2,000.
By offering a personal charge device in combination with an EV on a lease or financing contract, manufacturers can help EV users become independent of public charging infrastructure. Some EV makers have already teamed up with charge point providers such as ABB or Schneider to offer easy-to-use charge devices.
Assumption: “EVs are expensive” - Fact: Electric vehicles compete with conventional cars on total cost of ownership.
PA’s research, calculating the total cost of ownership, shows that many EVs can compete on cost with comparable vehicles that depend on an internal combustion engine. Our calculations assume a fuel price of €1.70/litre and annual usage of 10,000+ kilometres. When lower maintenance costs are included in the equation, the financial case for buying an EV becomes even stronger. Government incentives make a difference too. In France, the registration bonus for EVs of €6,300 brings the purchase price of some EVs, battery included, below that of similarly sized conventional vehicles.
PA Consulting Group is working with private and public sector organisations to develop the right car for a resource-efficient future. This includes encouraging convergence across industries to improve vehicle technology, energy supply, connectivity,business models, and the new generation of megacities.
We worked closely with car makers such as Magna Steyr to cut the costs associated with batteries and hybrid transmissions. We also worked with utilities such as Glendale Water & Power to define and develop business cases relating to charging infrastructure and to enable better EV market share.
To find out how we can work with your business to accelerate EV take-up, please contact us now.