How popular opinion of electric vehicles has changed over time
March 21, 2018
March 21, 2018
It may seem like electric vehicles are finally having their heyday, but their existence dates back to over a century, and consumer attitudes have seesawed dramatically. The potential for electric vehicles seems to be at its peak, but even that’s been said before. So what factors sway popular opinion on this vehicle type and what does the market foresee in the future?
A Brief History
Electric vehicles were once the most popular automobiles on the road, but the industry has always been highly influenced by government regulations. Although EVs saw a small surge in the 70’s, it’s wasn’t until the early 90’s, when government provisions were reestablished, that automakers began to rethink their convenience and efficiency.
The Clean Air Act was originally written as the Air Pollution Control Act in 1955. It was the first time the government ever stepped in to control air pollution. It was amended several times until 1990 when the EPA imposed such harsh sanctions on emissions, people began to seriously consider electric vehicles.
The 1992 Energy Policy Act that followed was the final push for investors to start pulling out their wallets. Additionally, the California Air Resources Board took it a step further. They passed regulations that required automakers to manufacture an EV model in order to sell their other models in the state.
In 1996, GM produced the first EV to be sold on a “large” scale. Unfortunately, there were only 1,117 units of the EV1 model ever made. The car had limited availability and could only be leased. The Toyota Prius came next and was manufactured in Japan. In the first year alone, they sold over 50,000 units and now boast more than 10 million worldwide.
Tesla emerged in 2006 and really helped raise awareness about electric vehicles. Cars like the Roadster were super stylish and they prompted consumers to take notice. Subsequently, so did big brands like Nissan and GM. Although Tesla promised a range of up to 200 miles per charge (which was better than anything on the market) the price point of $100,000 was way off for most potential buyers.
2010 saw Nissan’s first EV named the LEAF. With a range of 100 miles per charge and a price of only $30,000, it has become the bestselling highway-capable EV on the market. The Chevy Bolt one-upped Nissan in 2016 with a range capability of 238 miles and a cost of around $30,000 (after tax credits).
Why do we Need Electric Vehicles?
The reasons for why the electric vehicle exists are many and the benefits are great. It goes far beyond the environment, but that is a huge factor. Although the general public still has a slight misunderstanding about the mechanics of EVs, people are starting to catch on to their many advantages.
It’s known as the “Tesla Effect” and it basically infers that Tesla’s electric vehicles have halted the demand growth of gasoline for the next 25 years. The International Energy Agency (IEA) recently indicated that worldwide gasoline consumption has peaked, thanks to the growth of the electric vehicle market. They estimate that by the year 2040, there will be over 150 million electric vehicles worldwide.
Lower Cost of Ownership
One misnomer for people is that electric vehicles are expensive. They are actually shown to save consumers money in the long run. That’s because they have a much lower cost of ownership. The cost to refuel an electric vehicle is just a fraction compared to a combustible engine. In fact, drivers save an average of $700 a year in fuel costs and over $1,000 in some cities.
When it comes to greenhouse gas emissions and air pollution, electric vehicles are far cleaner than anything else on the road. If your source of electricity is a clean electric grid, EVs can be comparable to a car getting over 100 miles per gallon. Solar and wind powered charging stations allow EVs to operate close to emission-free.
The Current Market
A dozen brands now offer more than 40 models of electric vehicles and they come in a variety of sizes, range, prices, and powertrains. This year will be the first that the Chevrolet Bolt is going nationwide, with more than 20,000 units sold. The price for the Bolt starts at $37,000 with a range of up to 238 miles.
For now, Nissan does not intend to go up against Chevrolet, but their redesigned LEAF is just entering production. The Tesla Model 3 is priced about the same as the Bolt, but Tesla has struggled to meet demand.
Each of these brands are shaping the way in which consumers view electric vehicles. Tesla has transformed EVs into stylish rides, while companies like Nissan and Chevrolet have made them affordable. The future is bright as these cars become more and more accessible to regular dealers, not just start-up manufacturers.
Despite all the market reassurances, people still have concerns. While 30% of US buyers consider electric cars, only 3% actually go through with the purchase. McKinsey surveyed over 3,500 potential buyers to see what some of the issues were and the findings were interesting. Approximately 50% stated they were unsure of how the vehicles even operated. Some other concerns included:
Consumers have a lot of issues when it comes to the battery in an EV. Despite the fact that electric vehicles have fewer moving parts, people tend to think they break down more often. It will take people seeing EVs more and more on the road for that anxiety to level out.
There is also a problem with cost. Although the cost dropped over 80% in the last 6 years, batteries are still priced at $227/kWh. In order to become affordable for the general public, however, the price needs to fall to just $100/kWh. Roughly 50% more.
Potential buyers also felt that electric vehicles would run slower than gas-powered engines. However, one of the main sells to an EV is that they have improved acceleration and torque. Tesla is slowly changing this perception.
Though federal tax breaks spurred the EV industry in the United States, it is now of great concern to the industry. The $7,500 federal credit that manufacturers have been relying on to make EVs affordable is going away soon. The credit is set to phase out after each manufacturer sells 200,000 units. Atlanta used to be one of the top 10 cities for electric vehicle sales. Then the federal credit was eliminated. Now the market barely exists.
Range and Infrastructure
McKinsey also reported that customers assumed they would feel much more range anxiety than they actually did after purchasing an EV. Although they did contend that lack of infrastructure was a big problem for consumers. They estimate there are around 2 million public and private charging stations worldwide. This could grow to over 12 million in just 2 years if manufacturers follow through with their set plans. The best example is China. They went from just 8,000 stations in 2011 to 110,000 just four years later.
Despite the positive outlook, it is undeniable that the electric vehicle market is largely influenced by government policy. In order to raise the public opinion on electric vehicle adoption, key elements must be set in place. Infrastructure issues should be addressed, policy should be reevaluated, and consumer education programs established. Although there is some work to be done, public opinion on the EV market is still better than it’s been in a hundred years.