All of the efforts by manufacturers to make electric vehicles more popular seem to be working; however, there is one issue that they haven’t resolved that may be keeping EV sales from taking off: price.
EVs and all their variants – hybrids, plug-in hybrids, etc. – are still too expensive, in spite of potential savings on fuel.
Navigant Research, a consulting firm located in Boulder, Colo., surveyed nearly 1,100 people to determine how they feel about new vehicle prices and electric vehicles. The company found that 71% want their next vehicle to cost less than $25,000, while 41% are looking below $20K.
It also discovered that 67% of those surveyed had a favorable opinion on hybrids while 61% thought positively of EVs. In short, well over half the market would consider buying an EV or hybrid, but cannot because the price is too high.
However, the tide could be turning, according to Navigant. Battery packs, which can account for as much as half of PEV costs, are expected to decrease between now and 2020. HEVs and PHEVs are anticipated to see a 10% and 26% decline, while BEVs will likely remain flat, but see improvements in vehicle range and performance during that period.
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When combined with gas and diesel prices that are expected to rise 7.2% and 8.3% respectively during the same time period, Navigant believes the buyers are coming.
Navigant Research forecasts global CAGRs of 11.5% for hybrids, 31.9% for plug-in hybrids and 31.5% for battery-electrics. Asia Pacific and North America are expected to be the largest markets for hybrids, with Japan and the United States being the largest singular markets: 1.1 million and 1 million HEV sales in 2020, respectively.
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North America is the only market anticipated to have significantly higher sales of plug-ins than battery-electrics (a 1.5:1 sales ratio); Western Europe, Asia Pacific, and Latin America will be almost evenly split between the drivetrains. Asia Pacific is projected to be the largest market for plug-in electric vehicles (PEVs), with 1.6 million PHEV and battery-electric sales combined in 2020.
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