We’re headed into an era in which the landscape of consumer preferences and cognition will define how quickly we electrify our vehicle fleet.
A couple of years ago while dining with friends, someone asked me about electric vehicles, and it led me to describe a section in my MBA-level course on clean energy finance. “One barrier,” I explained, “is that people just don’t know how to buy EVs!” I meant it as a catchy summary of the consumer-level barriers to adoption when a product market undergoes significant and rapid change.
I found myself staring into uncomfortable, deer-in-the-headlights expressions on my friends’ faces, and I realized: they don’t know how to buy EVs!
What exactly does that don’t-know-how-to-buy shorthand mean? I had a specific set of points in mind, from a context of the business school classroom. A few examples:
- People know about life-cycle costs, but they use sticker price as a proxy; in the shift from ICE vehicles to EVs, that thinking needs to shift to accommodate lower operating costs relative to sticker price.
- People are used to having to go someplace to fill up with gasoline, and even though they know they have electricity at home, they might underestimate the extent to which ‘filling up’ at home will substitute for trips to the gas station.
- People have heard about ‘range anxiety’ so much that they come to assume that it is a uniformly relevant barrier, when in fact the vast majority of trips are short and the median EV for sale in the U.S. now has a range of over 250 miles.
And so forth. In other words, we have powerful buying brains, but our car-buying brains have not yet adapted to EV circumstances.
Pile on the stop-start turbulence in EV policy, and some pro-EV observers have been pretty worried about this state of affairs.
Hand-wringing about EV adoption
WIRED recently lamented that The US Refuses to Fall in Love With Electric Cars. The author highlights the superiority and consistency of Chinese and European EV policies, and brings up many important points about fundamental barriers to EV adoption in the U.S. This is especially true relative to Europe, where decarbonization has proceeded consistently on all fronts for many years.
If one hopes for the U.S. to get on the EV bandwagon, the aggregate picture of sales does look a little daunting.
I agree that this picture looks semi-apocalyptic: America, the land of the car, is being lapped by China and Europe in total sales. Clear and strong policy makes a difference, and our EV policy has been weak and muddled, or at least hot and cold, over the critical years covered by the Obama-Trump-Biden era.
Yet if we’re seeking insights about EV adoption, there’s some disaggregation and arithmetic to do with the data. As the graph below makes clear, “the United States” is not an entirely helpful unit of analysis here, nor for that matter is “Europe” – within each larger unit, there are success stories.
Since I’m writing from the Willamette Valley, I’ll puff up my chest and point out that Oregon rolls up around 10.2 plug-in electric cars per thousand people – double the U.S. average, and even ahead of Germany, the birthplace of many automotive inventions (and perhaps of the car itself).
I’m not the only person to see pockets of adoption. A Forbes piece from last fall explained Why California’s Bay Area Is Now The Best Place To Buy An Electric Car, describing extensive policy support and abundant public charging. Maybe the Bay Area is the Norway of North America in this regard – not a bad parallel, given that the Tesla-heavy San Francisco-Oakland-Berkeley Metropolitan Statistical Area is like a small country, with very nearly the population of Norway.
You know what else is surely different in these places with concentrated adoption? People there are more likely to “know how to buy an EV” because it is familiar. Or maybe even just plain normal – and that is precisely the language in this ad from Electrify America, the charging station network funded by Volkswagen as part of its Dieselgate settlement.
And if they’re normal, then surely we’re on the path toward learning how to buy them! Which leads us finally to my desperate attempt to clear the road toward intelligent EV choosing.
Enter the EV Chooser
I conceived of this ‘tool’ for several distinct reasons that all demand at least quick treatment. First, I wanted to tackle the basic idea: wrestling with the competing criteria inherent in choosing a car, but in the context of EVs.
Second, and more subtly, I wanted to acknowledge the high end while showing off the breadth of options with practical angles. It is common for consumers to hear of something expensive, and then to assume it’s expensive forever. EVs are steadily becoming more accessible.
Now before you start complaining about what’s missing, let me head you off at the pass. No, there are no PHEVs in here, which leaves out many appealing options from Hyundai, Kia, Toyota, Chrysler, and others; I simply chose to focus on electric-only cars, as I view PHEVs as a transition technology, albeit an important one. Yes, I excluded both the Nissan Ariya and the Fisker Ocean because they aren’t available yet; as an aside, Henrik Fisker has had plenty of time to deliver (and he’s behind schedule). No, I did not think the Mini Cooper Hardtop EV was worth our time – its paltry range of just 114 miles gives me flashbacks to 2013. Yes, I apologize to the million-plus owners of the Tesla Model 3, perhaps the most important all-electric vehicle to date and still the most successful EV ever, by a considerable margin (though the diminutive Wuling Hongguang Mini EV may be a challenger). And for the record, although I have plenty of criticism for Elon Musk, I must emphasize that Tesla is still the main character in all global EV markets, though the cast is growing.
And why bother guiding people toward the Model 3 anyway? Plenty of folks have already figured out how to buy it. No EV Chooser needed there. And anyway, the decision tree captures most of the EVs currently available in the United States – I invite you to confirm this with EV Adoption’s excellent filterable and up-to-date table.
Of course, an EV Chooser tool will get us only so far. To interpret what Aaron Gordon noted in Vice in an excellent discussion of EV adoption, we must close the perception gap between what EV-curious folks believe and what EV owners already know. Consider the Biden Administration’s plan to build a massive nation-wide charging network, seemingly to range anxiety reported by people considering an EV purchase. Yet that means “building out an infrastructure system for the people who don’t use it, not for the people who do. In fact, lack of public charging availability—and range anxiety more generally—is not a major concern among most EV owners.”
Wha-what?!? EV owners do not have range anxiety? And would-be owners do? (Read Gordon’s article for the full scoop.) Herein lies the challenge: too many of us simply don’t know what it means to own an EV, and it’s that lack of familiarity that is perhaps the greatest barrier to adoption. Surely a major barrier is just understanding when an EV is the less expensive option over the life of the vehicle, and that “news” is fortunately trickling out (e.g., here and here and here), with Volkswagen even appearing to acknowledge explicitly that its electric options are a better deal. There is no single solution here, but anything that normalizes ownership and frames it in terms we understand – camping, towing things, the commute, carrying the whole family, etc. – will move us a little farther down the road.
So maybe an EV Chooser is part of the solution after all.