The Car and Truck Fleet and Leasing Management Magazine

J.D. Power: EVs to Represent Just 7.3% of Cars by 2020

November 01, 2010

WESTLAKE VILLAGE, CA - Combined global sales of hybrid electric vehicles (HEVs) and battery electric vehicles (BEVs) are expected to total 5.2 million units in 2020, or just 7.3 percent of the 70.9 million passenger vehicles forecast to be sold worldwide by that year, according to a report issued by J.D. Power and Associates.

For comparison, global HEV and BEV sales in 2010 are forecast to total 954,500 vehicles, or 2.2 percent of the 44.7 million vehicles projected to be sold through the end of 2010.

The report, titled "Drive Green 2020: More Hope than Reality," offers a rather pessimistic view of the future EV market. It considers various factors affecting the future potential for "green" vehicles in the world's largest automotive markets. These factors include market trends, regulatory environment, consumer sentiment and technology development in these markets.

According to the report, it will be difficult to convince large numbers of consumers to switch from conventionally powered passenger vehicles to HEVs and BEVs. A consumer migration to alternative powertrain technologies will most likely require either one of the following scenarios, or some combination of these scenarios:

  • A significant increase in the global price of petroleum-based fuels by 2020
  • A substantial breakthrough in green technologies that would reduce costs and improve consumer confidence
  • A coordinated government policy to encourage consumers to purchase these vehicles.

Based on currently available information, the report concludes, none of these scenarios are believed to be likely during the next 10 years.

"While considerable interest exists among governments, media and environmentalists in promoting HEVs and BEVs, consumers will ultimately decide whether these vehicles are commercially successful or not," said John Humphrey, senior vice president of automotive operations at J.D. Power and Associates. "Based on our research of consumer attitudes toward these technologies -- and barring significant changes to public policy, including tax incentives and higher fuel economy standards -- we don't anticipate a mass migration to green vehicles in the coming decade."

The report asserts that consumers have a variety of concerns about HEVs and BEVs, including:

  • Dislike of their look/design
  • Worries about the reliability of new technologies
  • Dissatisfaction with overall power and performance
  • Anxiety about driving range
  • Concern about the time needed to recharge battery packs.

There are also the personal financial implications of deciding to purchase an alternative-energy vehicle. While many consumers around the world say they are interested in HEVs and BEVs for the expected fuel savings and positive environmental impact they provide, their interest declines significantly when they learn of the price premium that comes with purchasing these vehicles, the researchers note. 

"Many consumers say they are concerned about the environment, but when they find out how much a green vehicle is going to cost, their altruistic inclination declines considerably," said Humphrey. "For example, among consumers in the U.S. who initially say they are interested in buying a hybrid vehicle, the number declines by some 50 percent when they learn of the extra $5,000, on average, it would cost to acquire the vehicle."

The overall cost of ownership of HEVs and BEVs over the life of the vehicle is also not entirely clear to consumers, and there is still much confusion about how long one would have to own such a vehicle to realize cost savings on fuel, compared with a vehicle powered by a conventional internal combustion engine. The resale value of HEVs and BEVs, as well as the cost of replacing depleted battery packs, are other financial considerations that weigh heavily on consumers' minds, the report states.

But it is clear from research in the world's largest automotive markets that buyers of hybrid and electric vehicles occupy a unique demographic niche. Buyers of HEVs and BEVs are generally older, more highly educated (possessing a postgraduate degree), high-income individuals who have a deep interest in technology, or who like to be among the early adopters of any new technology product. As a result, it is not clear that HEVs and BEVs will appeal to the general population, the report asserts.

Twitter Facebook Google+


Please note that comments may be moderated. 
Leave this field empty:

Fleet Incentives

Determine the actual cost of owning and running a vehicle in your fleet. Compare vehicles by class and model.

Sponsored by

Terminology used in the United States and Canada to denote a financing type lease which is required to be "capitalized," i.e., the leased equipment must be recorded on the Lessee's balance sheet as assets with corresponding liabilities.

Read more

Alternative Fuel Locator

Use the Alternative Fuel Locator to find stations near you.

Launch Alternative Fuel Locator

Up Next

More From The World's Largest Fleet Publisher