- Original Paper
- Open Access
How to promote electromobility for European car drivers? Obstacles to overcome for a broad market penetration
© The Author(s) 2015
- Received: 27 December 2014
- Accepted: 3 August 2015
- Published: 2 September 2015
Electric vehicles can be a successful mobility alternative, but several obstacles and challenges have to be overcome first. Especially the customers’ purchase decision determines whether an innovation like electromobility will be eventually successful. The objective of this paper covers the investigation of consumer’s attitude towards electric vehicles and their opinion on potential promotion measures and its impact on market penetration scenarios in different countries.
The aforementioned issues were investigated via a European wide online consumer survey. It was designed to identify the awareness of potential consumers of electric cars as well as to discover their attitude towards this new technology. In addition to the picture of potential demand-related obstacles, the consumers were asked to evaluate the suitability of various promotion measures. Finally, the findings were included in an agent based vehicle market model which specifies consumer demand and market supply of electromobility scenarios.
The results show that the consumer attitude towards electromobility is rather positive and electric vehicles are generally perceived as environment-friendly and secure. But the high acquisition costs and the uncertainty about the operating costs deter consumers from purchasing an electric car. First results of the inclusion of potential promotion measures such as financial incentives in a scenario based market model show a significant increase of the electric vehicle uptake in Germany.
Potential customers have high expectations regarding the comfort and range of an electric vehicle. One of the most important barriers and obstacles for a broad market uptake are the currently high purchase prices for this new technology. Therefore, it seems quite necessary to make electric vehicles from a customer’s standpoint more attractive. From the customer’s perspective a dense network of charging stations and financial measures such as tax and energy cost reductions are vital prerequisites in order to convince them to buy an electric vehicle. Finally, it has been proven within a scenario based market model for Germany that the use of different promotion measures by the national government can enhance the market share of electric vehicles substantially until 2030.
- Electric cars
- Consumer survey
- Market penetration
- Market obstacles
The market introduction and penetration of electric vehicles can be seen as a milestone in order to reduce the environmental burden imposed by the transport sector. The wide-spread use of electric vehicles powered by electricity from renewable sources promises a substantial reduction of local emissions in urban areas as well as greenhouse gas emissions (GHGs). The European Commission (EC) is aiming at a reduction of 20 % of GHGs by 2030 with respect to 2008. This aim still implies an 8 % raise compared to the baseline year 1990 and refers to the substantial increase in transport and transport emissions in the past two decades . In order to achieve this ambitious goal, the EC White Paper: “Roadmap to a Single European Transport Area – Towards a competitive and resource efficient transport systems” proclaimed the goal of halving the use of ‘conventionally-fuelled’ cars in urban transport by 2030.
Electric driven vehicles offer a solution to reduce greenhouse gas emissions and local air pollution, but their market penetration is still marginal. In order to identify the market potential as well as adjusting screws to overcome current obstacles for a further deployment of electric vehicles, the eMAP project (electromobility – scenario based Market potential, Assessment and Policy options) has been initiated within the ERA-NET Plus transnational call Electromobility + in 2012. Electric vehicles in the project as well as in this paper are defined as plug-in hybrid electric vehicles (PHEV), range extended electric vehicles (REEV), and battery electric vehicles (BEV).
The project eMAP concentrates on the analysis and assessment of the market penetration of electric vehicles and its socio-economic impacts. In this process feasible deployment paths of electric vehicles are investigated for the time horizon until 2025–2030. This is done by a scenario based market model which specifies the demand potential and market supply of electromobility. As a major input for the scenario modelling and calculation of potential market penetration paths of electric vehicles until 2030, a consumer survey was completed by the end of 2013 . In order to identify the demand-related obstacles and potential impacts of imperfect information as well as for the formulation of political support measures and strategies for the market uptake of electric vehicles more than 6,000 online interviews from all over Europe have been conducted. The results of this consumer survey are presented within this article with regard to EU wide answers as well as certain country specific characteristics. Finally, a brief impression is given of the impact of a specific set of policy measures on the market penetration of electric vehicles in Germany until 2030.
Battery technology (costs, energy density, recycling etc.)
Availability and preparedness of relevant industrial capacity (business models, new vehicle models etc.)
Charging infrastructure (minimum density of charging points, identification of early adopter hotspots etc.)
Customers’ requirements (awareness, willingness-to-pay, range anxiety, safety concerns etc.)
Electric grid (capacity and connectivity issues etc.)
Impacts on energy efficiency and green house gas emissions (electricity mix, load management etc.)
Standardisation issues (charging plug, billing systems, data protocol etc.)
Despite the fact that the interlinkages between the aforementioned factors can play a major role for the market penetration of electric cars, the customers’ requirements and expectations are the most decisive aspects for the market deployment of alternative propulsion systems. Even if the technical challenges will be resolved to a certain degree via the standardisation of the charging plug  and a certain minimum of charging points per country , the customers’ purchase decision determines finally whether an innovation like electromobility will be successful or a failure on functioning markets. Therefore, this paper concentrates on demand-related obstacles and barriers for a broad market deployment of electric cars. In order to get some insight into these potential obstacles and barriers on the demand side, a European-wide consumer survey was conducted. It was designed to identify the awareness of potential consumers of electric cars as well as to give an estimate of the attitude towards this new technology. In addition to the picture of potential demand-related obstacles the consumers were asked to evaluate the suitability of various promotion measures.
There are several reasons to promote the market penetration of electric vehicles. The range of potential benefits goes from operating cost savings, higher efficiency, greenhouse gas emissions reductions, local air quality improvements, traffic noise reductions as well as local or national employment effects through the development and production of electric vehicles and the use of domestically-produced electricity .
For almost two thirds of the surveyed license holders a dense network of charging stations is a vital condition for their decision to buy an electric car. Only seven percent of the respondents rate this measure as irrelevant for their decision. This essential condition is followed by the financial measures which lead to lower running costs, such as the reduction of energy costs or the annual car tax for electric vehicles. Also, a one-time bonus for the purchase of an electric vehicle is considered as an adequate measure to promote the market penetration. These four measures are vital conditions for the majority of respondents when it comes to purchasing a car.
Furthermore, the possibility to experience electric cars and go for a test ride as well as the offer of all-round and all-purpose electric cars are quite important for the respondents. However, only less than one third of the respondents see measures such as free parking in city centres, special credit offers with lower interest rates, or information campaigns as inevitable requirements for the purchase decision. Nevertheless, most of the interviewed persons regard these measures as an appropriate incentive. Overall, measures that give electric cars an advantage compared to conventional cars are welcomed by the majority of the consumers as appropriate incentives. Measures in disadvantage for conventional cars such as restricted access to certain areas in cities and an increase of fuel costs car are rather rejected by the majority of the respondents.
Results are generally similar in the observed countries and differ only in details. For example, in Finland the reduction of energy costs, lower insurance rates as well as bonus and benefits for a purchase are not as essential as in Germany and Poland. In Poland information campaigns, free parking in city centres and special credit offers with lower interest rates are more important than in Germany and Finland.
Cooperation between the EU and national governments is required with regard to the two most important measures: implementation of a dense network of charging stations and reduction of energy costs. These two challenges are perceived as national and European sphere of activity respectively. The second important cooperation is conceived between national governments and car manufacturers: offering bonuses and benefits for purchasing an electric car and credits with lower interest rates as well as promoting an information campaign are the fields of activity where these two players are important.
Exemplary for the scenario results of the project, the impacts of political measures on the market penetration of electric vehicles are presented for Germany. The boundary conditions for the market in Germany have been modelled, taking the current situation as well as the development of key parameters like vehicle taxation, incentives, fuel prices and energy consumption, as it can be foreseen from today, into account. Hence, a business as usual scenario (BaU) was calculated for the German market from 2015 until 2030. In a second step, an alternative, policy driven scenario (PoD) has been developed, in which several measures have been introduced to fasten the market penetration of EV: Relating to the results from the customer survey, the three most important factors have been addressed. The expansion of charging infrastructure was accelerated by 10 %. The electricity price for charging an electric vehicle was lowered by removing the renewable fee (so-called “EEG-Umlage”, in 2015 6.17 €ct/kWh). The purchase costs of electrified vehicles (plug-in hybrid electric vehicle (PHEV), range extended electric vehicle (REEV), and battery electric vehicle (BEV)) were lowered by 1,500 € by tax exemptions or purchase premiums for a period of 5 years (2016–2020). Since some of the high rated factors in the customer survey address other, non-monetary measures like information campaigns, it was assumed that the willingness-to-pay for electric vehicles would be 10 % higher than in the base scenario .
The results from the European wide eMAP consumer survey show a relatively high awareness of the consumers of electric vehicles. Nevertheless, potential customers have high expectations regarding the comfort and range of an electric vehicle. One of the most important barrier and obstacle for a broad market uptake are the currently high purchase prices for this new technology since not all respondents were aware of the lower operating costs of electric vehicles. Consumers are also not convinced of the environmental benefits of these new cars, which is partly understandable regarding the current electricity mix in European countries. If it comes to sacrifice financial resources for the reduction of CO2, most potential consumers would rather have a lower or average purchase price than an environmental friendly car. Therefore, it seems quite necessary to make electric vehicles from a customer’s standpoint more attractive. To reach a broader acceptance of electric vehicles several private and governmental measures can be used. From the customer’s perspective a dense network of charging stations and financial measures, such as tax and energy cost reductions are vital prerequisites in order to convince them to buy an electric vehicle. Also test drives and more information can decrease the information gaps of consumers about comfort, safety, range limitations and operating costs of this new drive technology. During the interviews it was apparent, that the most important stakeholders for the promotion of electric vehicles are the national governments and the EU. Especially the charging infrastructure as well as the financial incentives should be guaranteed by the governmental side. But on the other side, the consumers also expect more information and a better supply of car models from the automotive industry. Finally, it has been proven within a scenario based market model for Germany that the use of asset of different promotion measures by the national government can enhance the market share of electric vehicles substantially until 2030. The example of Norway has shown that tax exemptions can raise the stock of electric vehicles relatively fast. Since the current policy in Germany mainly supports research initiative, showcase projects and non-monetary measures, such as the planned benefits of free parking as well as the use of bus lanes in city centres but only to a lesser degree direct financial incentives, the broad public acceptance of electric vehicles will be probably lower than expected. In the end, the market success of electric vehicles will be determined by the change of the customer’s purchase decisions from conventional cars to electric vehicles.
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