WESTLAKE VILLAGE, Calif. — Electric vehicles (EVs) will remain a very small part of the U.S. market unless automakers can lower prices and demonstrate the economic benefits to consumers, according to the J.D. Power and Associates 2012 Electric Vehicle Ownership Experience Study.
Current EV owners most often cite environmental friendliness as the most important benefit of owning an EV. Nearly one-half (44 percent) of these owners indicate the top benefit of their vehicle is lower emissions, compared with emissions from gasoline- or diesel-powered vehicles.
However, consumers considering an EV for their next vehicle primarily want to lower their fuel costs. And although 11 percent of consumers would consider an EV for its environmental benefits, 45 percent want to reap the economic benefits of fuel savings. For example, current EV owners report an average monthly increase in their utility bill of just $18 to recharge their vehicle’s battery — which is significantly less than the $147 that they would typically pay for gasoline during the same period of time.
“Current EV owners focus on the emotional benefits of owning an electric vehicle — which are having positive effects on the environment — but the way for manufacturers to take EVs to the masses and increase sales is to address the economic equation,” said Neal Oddes, senior director of the green practice at J.D. Power and Associates. “There still is a disconnect between the reality of the cost of an EV and the cost savings that consumers want to achieve.”
Compared with sales prices for a similar gasoline-powered vehicle, the study found that owners of all-electric vehicles (AEV) pay a premium of $10,000, on average, for their vehicle, while plug-in hybrid electric vehicle (PHEV) owners pay a $16,000 premium, on average. Based on annual fuel savings, it would take an average of 6.5 years for AEV owners to recoup the $10,000 premium they paid at the point of purchase, while the payoff point for PHEV ownership is 11 years.
Driving range and the availability of charging stations are the top concerns among consumers considering an EV. The study found that 12 percent of EV intenders are concerned about the driving range. However, current EV owners indicated an average daily commute of 34 miles —which is well within the range of a fully charged EV.
The size of the vehicle is the second-most-frequently cited reason for rejecting an EV. Consumers considering an EV look more frequently for a midsize sedan than any other size vehicle. Currently, most of the EVs being produced are in the small vehicle segments, which should change as new midsize models enter the market in 2013.
In addition to price and vehicle size, concerns with reliability of EVs rounds out the top three rejection reasons.
The payoff for automakers is that once they get consumers to buy an EV, they tend to retain them as customers. Overall, 82.5 percent of owners indicate they “definitely will” or “probably will” buy another EV from the same brand. The average retention among owners of all vehicle types is 49.8 percent.