Study: Many American car buyers aren’t ready to pay the price for eMobility
Customers are deterred by high costs & convenience cutbacks when it comes to more environmentally-friendly car options such as electric vehicles.
BOSTON–(BUSINESS WIRE)– The U.S. Automotive Study 2020* conducted by Simon-Kucher & Partners, a global strategy and marketing consulting firm, revealed that buyers are interested in electro mobility (or eMobility), but aren’t willing to pay up for it.
“While there is an appetite for more environmentally-friendly vehicles, we still see that only a small portion of American consumers express a willingness to pay more for environmentally-friendly options”
The study found that there is a substantial interest in eMobility amongst US automobile consumers – 41 percent of participants indicated they would consider a hybrid vehicle for their next purchase. However, this number drops considerably when it comes to consumers who would consider electric vehicles (EVs) for their next purchase to only 17 percent of respondents.
eMobility? Yes, if the price is right
“While there is an appetite for more environmentally-friendly vehicles, we still see that only a small portion of American consumers express a willingness to pay more for environmentally-friendly options,” said Matthias Riemer, Director at Simon-Kucher. “The study shows that only 45 percent of current buyers of hybrids or electric engines are willing to pay more for these features. This means that eMobility penetration is still heavily dependent on government subsidies.”
This is underlined by the fact that the most important purchase criteria for EV-considerers is price, by far. The study shows that price determines 35 percent of the purchase decision, followed by range with 16 percent.
EVs? Yes, if they are hassle-free
“Price is a big issue to break into the mass market, but for EVs there are additional obstacles. They also have to overcome concerns with regard charging infrastructure and range,” said Peter Harms, Partner at Simon-Kucher. Nearly 70 percent of consumer concerns are outside of pricing and are related to:
- Charging infrastructure
- Charging speed
“All of these concerns can be addressed in the upcoming years, and they have to be if EVs are supposed to become fit for the mass-market,” adds Harms.
Does this mean that EV producers have to price their cars very competitively?
“There is a wide disparity in the willingness to pay for EVs among customers. In the near term, the best strategy for profitable EV growth remains to ‘skim the market’ by offering well-equipped cars to well-off enthusiasts,” said Riemer.
*About the Study: The US Automotive Study 2020 was conducted by Simon-Kucher & Partners in 2019. More than 1,100 Americans who bought, leased or financed a new car were given a representative survey on current and classic topics relating to automobiles and mobility.