In a race to the future, automotive manufacturers are placing bets on various new mobility solutions to improve consumers’ experience. Such solutions encompass ideas like self-driving vehicles, battery-electric vehicles (BEVs), car sharing, subscription services, and more. The concept of improving mobility is at the heart of each of these solutions, but consumers remain reluctant.
Why the hesitation?
Charging, Range, and Cost
Three factors plague BEVs, both for consumer perception, as well as for the 5% of respondents who have owned one already: charging, range, and cost. These are the top three disadvantages listed by consumers consistently over the last three quarters that J.D. Power has conducted the MCI Study, negating the argument that this is an issue in perception only.
Charging station availability and driving range apprehension are rooted in trust issues. Consumers appreciate the idea of being able to travel unlimited distances, even if this is unrepresentative of their actual driving behavior. For example, more than three-fourths of consumers want their BEV range to be 300 miles or more, but their average daily commute is only 40 miles. Chances are, as long as they make sure to charge their vehicles when parked overnight, they’ll be able to get to and from their destination without issue. But 69% of consumers who have owned a BEV previously and experienced range anxiety firsthand still want a range of 300 miles or more.
Another cause for concern is the time needed to charge the battery — 58% of consumers are willing to wait 15 to 30 minutes to achieve a range of 200 miles, but when charging time exceeds an hour or more, willingness drops to 16%.
What's in It for Me?
Universally, a majority of consumers agree that BEVs are better for the environment. It is worthy to note, however, that more are openly questioning if the end-to-end production of the vehicle and its energy sources are cumulatively better for the environment. That set aside, though, when consumers are asked if a BEV will positively affect their life, there is more convincing to do.
There are less moving parts in a BEV compared with an internal combustion engine. So in theory, less should go wrong and less routine maintenance is needed. Those who have owned a BEV agree, with 42% stating an advantage to their BEV was it had lower cost and was easier to maintain. More to come on this issue, though, as battery life plays out in mass market implementation.
At-home charging is proving to be a useful benefit to those who have the ability to implement the same. There is an opportunity for automotive manufacturers to partner with public utilities to install at-home charging stations for new BEV owners during the point of sale — essentially recognizing the holistic BEV ownership experience and setting the new owner up for success. The J.D. Power 2020 Electric Utility Residential Customer Satisfaction Study of 12,500 residential electric utility customers shows that owners of plug-in electric vehicles (plug-in hybrid or BEVs) are much more satisfied with their utilities overall. And the price factor is the most impactful area for EV owners. Price satisfaction among plug-in EV owners averages 7.99 (on a scale of 1 to 10), compared with just 6.87 among those who do not own an EV. “This is especially noteworthy since EV owners charge at home nearly 64% of the time, increasing monthly electric bills, and yet their satisfaction with price is significantly higher than those who do not own an EV," said Jeff Conklin, vice president, Utilities and TMT Practice, J.D. Power.
Public charging stations are also being introduced into thoughtful spaces where consumers are naturally spending larger chunks of time, such as grocery stores, shopping plazas, hotels, and so forth. Both of these charging station strategies fit into consumers’ lives in a natural fashion and will, eventually, be seen as more convenient than gas stations once were thought to be.
Other surprise and delight elements are present within BEV ownership, but are not yet on the radar of the general consumer. Consider factors such as performance and acceleration, lack of engine noise, and the cost to charge compared with the cost of gas. There is an opportunity to shift the language beyond the environmental benefits making it more personal and relatable. Otherwise, the pattern of consumers saying, "BEVs are a good thing, but just not right for me personally," will continue.
Experience Matters
Those with BEV ownership experience are invaluable assets to encourage others to consider a BEV. The likelihood to purchase or lease a BEV is 91% for those who have owned one previously compared with 41% for those consumers who have never been in one. Even for those consumers who have simply ridden in or driven a BEV, their likelihood to purchase rises to 64% and 71%, respectively.
One element that does not vary across experience is the role that government tax credits or subsidies has on the purchase decision. More than three-quarters of consumers, whether they have owned a BEV or never been in one, agree that this strategic lever does have a factor on their decision.
Lastly, consider the learning curve consumers face to understand the unique language encompassing EVs. First and foremost, what type of electrification is it? HEV, PHEV, BEV, fuel cell, mild hybrid — the acronyms alone can be off-putting. Next comes the language surrounding performance, battery size, and charging plug types. It can all be overwhelming to learn, especially given the non-standardized and, arguably, non-consumer facing language used.
As the BEV market moves away from early adopters to mass market adoption (hopefully), the focus needs to be on getting consumers to experience BEVs for themselves. In the United States, more than two-thirds of consumers have never been in one. There is great opportunity to move the needle and shift perceptions via experience. Until that time, the reaction from consumers for BEVs will be, "Thanks, but no thanks."
This article is based on The Mobility Confidence Index Study, a quarterly study conducted by J.D. Power fueled by SurveyMonkey Audience. Sentiment is segmented into three categories: low (0 to 40), neutral (41 to 60), and positive (61 to 100). The latest report, which polled more than 5000 consumers and industry experts, found adoptions of BEVs remains at 55 (on a 100-point scale) for the third consecutive quarter.
