Turrentine, Thomas S. and Daniel Sperling (1992) How Far Can the Electric Vehicle Market Go on 100 Miles (162 Km)?. Institute of Transportation Studies, University of California, Davis, Presentation Series UCD-ITS-RP-92-31
The limited range and long recharge times of electric vehicles have created great uncertainty about the success of the electric vehicle market. Skeptics have maintained that no matter what the air-quality benefits are of electrics, consumers will not purchase a car with these inconveniences, especially at the prices new technology will cost. Against this skepticism, public studies of the market for EVs offer relatively good news to very bad news. Technical constraint studies find good news, that 20–60% of all households in the United States could substitute an EV with 162 km range for one of their current vehicles. In startling contrast, economic choice studies – based on the responses of consumers to hypothetical choices – find that limited range and long recharge are extremely expensive drawbacks and forecast probable sales of less than one percent to a few percent of the yearly new auto market. While the former are overly simplified views of constraints, the choice studies rely on poorly informed opinions, and end up measuring uncertainty rather than preferences.
To predict the market, we have followed the technical constraints approach, but added distinct theoretical framework which recognizes the revolutionary effect alternative fueled vehicles will have on the automobile market. We assume the knowledge and tastes of consumers will change; our goal is to understand how and what will change to identify the market segments which will develop in wake of these changes. We theorize the changes will result from a combination of innovation diffusion and social ice process, in which information, tastes and greenness of vehicles will shape new market segments. To investigate these dynamic situations, we have conducted three ad studies: 1) a test drive (along with 11 focus groups) of EVs, natural gas vehicles, and methanol vehicles by 236 persons from the Pasadena area of Los Angeles; 2) purchase intention and range simulation games (PIREG) with households who recently purchased a compact vehicle (Saturns, Hondas and Mazdas) and whose household fit previous EV market segments and 3) interviews with over 100 owners of electric vehicles in California.
The results of these studies demonstrate several dynamic factors in the market; the impact of information and experience on consumer purchase intentions; adaptive responses to limited range vehicles; and eventual optimization of electric vehicle use. In the test drive, 76% of participants said their opinion of EVs improve after a test drive. In focus groups, consumers expressed surprise at how practical the EVs were; they had expected golf carts and egg shaped vehicles.
PIREG participants were surprised at how easily electrics fit their needs; most were highly receptive to EVs if the price were equal to that of a gas car. Using detail diaries of their own car use, participants offered simple ways of adapting to limited range including swapping vehicles for longer days, opportunity charging at work and in some households increasing the vehicle stock. These households preferred these adaptations to more expensive, long range vehicles. The EV owners in the third stud are more habituated to limited range, and maximize their use of EVs to make savings on fuel and repairs. Some prefer renting to owning gas cars for extended journeys.
Our findings are that the first wave in EV sales will be driven by an incipient green market and innovation driven consumers whose high incomes allow them to experiment with EVs. For example, in Los Angeles, a small group of film and television celebrities have begun to use and endorse EVs. The consumption choices of celebrities have had a long history of influencing the tastes of consumers. The second wave of growth in the market will be among affluent, multi-car households, in poor air-quality areas, who maintain a recent vintage vehicle which is used in routine, predictable travel. Vehicles with a 162 km range will satisfy most of the market for this segment.
Longer range vehicles will attract more buyers to investigate EVs, but unless the price of longer range batteries is close to that of conventional batteries, may not increase the market significantly because the range will serve only marginal circumstances for the bulk of the market. Quick charging and fuel-cell technology will open up new market segments among consumers who have less predictable travel needs and will want on-the-road recharging abilities for unexpected circumstances. In the short run, the high price of EVs will be a greater barrier than range limitations.