From economic stresses to increased work-from-home numbers, byproducts of the COVID-19 pandemic are giving pause to car shoppers who might otherwise consider an electric vehicle to replace their internal-combustion-engine model. But this is just a short-lived bump in the road that will be followed by a rebound in consumer interest in EVs. There are compelling reasons for automotive brands to step up their EV marketing game right now.
Crafting an effective EV marketing strategy requires an understanding of the factors behind consumers' hesitancy to adopt this technology. An Autolist survey found that the top three are range anxiety, price and charging infrastructure. Those same attributes are also what shoppers most desire in an EV, just in a different order. Price is No. 1 — by a wide margin — followed by range and more charging options.
Price is the elephant in the room, but there's good news here. The gap between the average price of EVs and conventional vehicles is shrinking. When Cox Automotive analyzed data comparing June 2019 with June 2018, it found a 13.4 percent decline in the average price of EVs vs. a 2 percent increase for ICE vehicles. A flood of new EV models over the next two years will drive production costs down and accelerate price convergence.
Sticker price is just part of the equation. It's important to get car buyers to focus on total cost of ownership. Since the correlation between fuel prices and consumers' vehicle choices is well documented, gasoline prices hovering near historic lows would appear to be a disincentive for EV purchases. But the volatility of the oil market has been shown repeatedly, never more so then during the 1973 OPEC oil embargo. That was not just a footnote in history. Oil prices are forecast to rise again as the world economy recovers.
In contrast, the price of electricity is remarkably stable — and stability is a value with strong appeal to consumers in uncertain economic times. Likewise, minimal EV maintenance requirements represent another cost advantage.
Advances in battery technology and comprehensive warranties will help blunt consumer concerns around both price and range anxiety. Over the next few years, lithium ion batteries will be replaced by lithium iron phosphate batteries, which offer a longer life cycle and are safer and "greener," points that can be emphasized in EV marketing.
Newer batteries deliver ranges of up to 400 miles and last up to 1 million miles at about the same cost. Also, the federal government has mandated that automakers offer a minimum of an 8-year/100,000-mile warranty on batteries, and leading automakers already offer free replacements for batteries that lose 30 to 40 percent of capacity during the warranty period.
Overcoming the charging infrastructure challenge likely will require a joint effort involving EV makers, federal and local governments and partnerships with tech companies. The penetration of public charging stations in the U.S. should hit European levels within a decade, but home charging should remain the preference in the U.S., where homeownership is almost 68 percent.
By promoting their fleet of EVs, auto brands can represent the change consumers desire — and it's always better to be the change than to be its victim.