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J.D Power EV study: car makers must boost attractiveness to succeed

A new study into the experience of current and potential US electric vehicle owners, has concluded that EVs will stay in the minority for sales unless car makers lower prices and better demonstrate the potential economic benefits to consumers.


The inaugural J.D Power and Associates 2012 Electric Vehicle Ownership Experience Study explored the EV shopping and consideration experience, as well as ownership experience, of 7600 people during the month of October.

The study found that 44 per cent of current EV owners cited the environmental friendliness of their vehicle’s lower emissions – compared to those from petrol- or diesel-powered vehicles – as the most important benefit of owning an EV.

In contrast, only 11 per cent of those considering an EV for their next vehicle were concerned with the environmental benefits, with 45 per cent focused on the economic rewards of reduced fuel costs.

Current EV owners reported an average monthly utility bill increase of US$18 once they began recharging their new vehicle at home – substantially less than the reported US$147 average previously spent on fuel during the same period.

J.D Power and Associates senior director of the green practice Neal Oddes said, existing owners of electric vehicles focus on the emotional benefits of owning an electric vehicle, such as having a positive effect on the environment, but manufacturers must address the economic equation to convince the masses and increase sales.

"There still is a disconnect between the reality of the cost of an EV and the cost savings that consumers want to achieve," Oddes said.

The study found that owners of all-electric vehicles (AEV) pay a US$10,000 premium on average, over the price of a similar petrol-powered vehicle, with plug-in hybrids (PHEV) netting a premium of US$16,000.

According to the study, it would take an average of six and a half years for AEV owners to recoup the US$10,000 premium, based on annual fuel savings, while this balloons out to 11 years for PHEV owners.

Oddes said this means the payback period is longer than most consumers keep their cars.

"The bottom line is that the price has to come down, which requires a technological quantum leap to reduce the battery price. There also needs to be an improvement in the infrastructure, or the number of charging stations outside of the home. Until those two concerns are addressed, EV sales will remain flat.

"Automakers need to continue to address these issues and educate consumers about the benefits of EV technologies in order to gain momentum in the marketplace."

In addition to price, vehicle size and concerns with reliability of the vehicle rounded out the top three reasons people rejected EVs.

The other point manufacturers should note, is that once consumers get into an EV, they tend to stick with that brand.

The study showed that most EV owners, definitely would or probably would, buy another EV from the same manufacturer, with 82.5 per cent indicating the bond would be maintained – the average brand retention among owners of all vehicle types is 49.8 per cent.

The 2012 Electric Vehicle Ownership Experience Study was based on online responses from people who either currently own an EV, are considering an EV for their next vehicle purchase, or shopped for an EV but ultimately decided not to purchase one.

Currently in Australia the range of electric vehicles on offer includes the $48,800 Mitsubishi i-MiEV, $51,500 Nissan Leaf, and $206,188 Tesla Roadster.

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