Tech advances will drive the transition to electric vehicles
Electric vehicles (EVs) make up 7% of U.S. new vehicle sales today, and new vehicle standards proposed in April will require this EV share to grow to an estimated two thirds by 2032.
Are consumers ready for the transition?
To understand mainstream consumer demand for future EVs, a team of researchers conducted consumer experiments eight years apart to determine what has driven the growth of the EV market and what it would take to increase future adoption. They found that consumers’ preferences for vehicle attributes, like longer range and cheaper operation, haven’t changed much, but they are more willing to adopt EVs as technology improves. With expected range increases and price decreases, the team predicted that demand for electric cars and SUVs could be comparable to gasoline cars and SUVs by 2030.
The team includes Jeremy Michalek, a professor of mechanical engineering and engineering and public policy; Kate Whitefoot, an associate professor mechanical engineering and engineering and public policy; their Ph.D. student Connor Forsythe, and Ken Gillingham, an economics professor at Yale.
Technology has progressed rapidly in the field of EVs. In the past decade, average EV efficiency has increased by 15 percent, while average range has increased by about 200 percent. The availability of EV models on the market has improved significantly, and the price-premium has dropped over time. Amidst these trends, states like California have adopted policies limiting the sale of new gasoline-only vehicles, and manufacturers like General Motors have called for stronger policies promoting new EV sales.
With these factors in mind, the team first conducted a survey of more than 1,500 prospective vehicle buyers to determine what factors influence their purchasing decisions. They then compared these results to those of a similar consumer survey conducted from 2012-2013. This helped them track changes in the market over time and allowed them to project how demand will grow through 2030. They found no statistically significant changes in consumer preferences for electric vehicles and electric vehicle attributes over this time, but estimated that the same consumer preferences would produce higher EV adoption as EVs catch up to gasoline vehicles on key attributes like range and price.
They estimated that if technology trends continue as expected and if EVs become as ubiquitous as gasoline vehicles by 2030, car and SUV buyers will become near indifferent between the two, on average.
For the policy makers and industry leaders attempting to plot the future of the automotive market, this information is crucial. Understanding market forces and our current course can help ensure that the U.S. is on a path toward reducing the nation’s largest source of greenhouse gas emissions.