AlixPartners the global consulting firm, released a multi-country consumer survey that points to both big opportunities and big challenges for the global automotive industry as it moves forward in its monumental transition to eco-friendly electric vehicles.
On the one hand, for instance, the survey—which polled licensed drivers in China, France, Germany, Italy, Japan, the United Kingdom, and the United States (with California’s results also analysed separately)—finds that “BEV Believers”—those “very likely” to buy or lease a battery-electric vehicle (BEV) as their next car—have on average more than doubled from a similar survey AlixPartners fielded two years ago. Today that number stands at 25%, up from 11% in 2019.
Moreover, each market in the survey this year registered an increase in this measure, led by China at 50% (up from 34% in 2019), while in the U.S. as a whole 19% said they are very likely their next vehicle will be a BEV (up from 5% in 2019’s survey)—and in trend-setting California 34% said that (up from 9% in 2019).
But on the other hand, the survey pinpoints several major hurdles ahead for the auto industry. For instance, it finds that vehicle cost is among the top-three concerns consumers in general have about buying a BEV, same as it was in 2019. In the same vein, it finds that if BEVs were at price parity with internal-combustion-engine (ICE) vehicles, 70% of U.S. consumers would be willing to spend their money on a BEV; but at a 25% price premium, that drops to just 10% of consumers.
The survey also finds that consumers, especially BEV buyers, are very demanding about having online purchase and ownership experiences—which could over time represent an existential challenge to in-person dealerships, as well as new, intensified challenges to automakers. For instance, the survey finds that those “moderately likely” and “very likely” to purchase a BEV across all the markets are almost three times more likely (42% vs. 15%, including 47% vs. 14% in the U.S.) to prefer an online experience than are those unlikely to buy a BEV. Meanwhile, 23% of those whose interest in BEVs has increased in the past year (including 36% in the U.S.) say the influence of friends and family is the main reason—which suggests that not only do sales models need to change, but as part of that perhaps more “grassroots” channels, such as greater use of social media, are in order.
- ‘BEV Believers’—those very likely to buy a battery-electric as their next vehicle—have more than doubled in the past two years, from 11% to 25% globally and from 5% to 19% in the U.S.
- Just 10% of U.S. consumers are willing to pay a 25% price premium to buy a BEV
- BEV buyers are almost three times more likely to prefer an online sales and ownership experience than are those unlikely to buy a BEV (42% vs. 15%)
- 23% of those who’ve become interested in BEVs in the past year (including 36% in the U.S.) say friends and family is their biggest purchase-influencer
- 27% (32% in the US) of moderately and very likely BEV buyers consider public charging availability “critical” to the purchase a BEV
- Automakers themselves are expected to orchestrate and ensure charging-network availability by 85% of the moderately and very likely BEV buyers in the U.S.
- Consumers want charging options beyond the home, but are unlikely to go out of their way to dealerships and gas stations (only 11% of charging is expected to take place at gas stations)
On the all-important vehicle-charging front, the survey finds that 27% (32% in the US) of moderately and very likely BEV buyers consider public charging availability “critical” to the purchase a BEV. Meanwhile, 47-62% of moderately likely and very likely BEV buyers plan to charge at locations other than their homes, including 47% in the U.S. who said that. And, in a very key finding, 48-86% of moderately likely and very likely BEV buyers (including 85% of those in the U.S. and 86% in California) said they expect automakers themselves to ensure available charging networks—which suggests that any corporate business plan relying on governments or other third parties alone to take care of ensuring public charging is probably foolhardy.“The good news is that with just a few exceptions around the world consumers seem to be getting more and more interested in electric vehicles,” said Mark Wakefield, global co-leader of the Automotive and Industrial Practice at AlixPartners and a managing director at the firm. “However, huge hurdles remain on many fronts, including achieving parity on vehicle cost, meeting consumers’ growing expectations for digitally driven sales and ownership models, and meeting consumers’ expectations that the auto industry itself, and not just governments, work to ensure charging infrastructures. The changes the industry are going though are truly historic; to succeed amid all the disruption will require both deeply-thought-through strategies and flawless execution. Either without the other won’t be enough.”
“In addition to getting their cost structures better in line with the amounts that consumers are willing to pay for electric vehicles, automakers and suppliers need to prioritize markets based on significant differences around the world in EV interest and customize their product portfolios accordingly, including taking into account such things as whether price or vehicle range is more important in a given market,” said Arun Kumar, global co-leader of the advanced mobility practice at AlixPartners and a managing director the firm. “Meanwhile, dealerships should be thinking hard about their futures starting right now, be it adopting all-new business models, undertaking M&A or being involved in consolidation. For everyone involved in any way in this auto industry today, the clock is very much ticking.”
About the survey
The AlixPartners 2021 Electric Vehicles Consumer Sentiment Survey was an online survey of 8,124 consumers in total ages 18 and older possessing driver’s licenses conducted August 17-31, 2021 in Greater China (1,007 respondents), France (1,005), Germany (1,015), Italy (1,019), Japan (1,017), the United Kingdom (1,007) and the United States (2,054, including 1,051 in California, whose results were analysed separately)—markets that accounted for 85% of battery-electric-vehicle (BEV) sales worldwide in 202