Study Finds About 1/3 of US New Vehicle Buying Households Have the Required Infrastructure and Buying Interest for PHEVs
10 August 2008
|Distribution of PHEV design choices by potential early market buyers in the study. Extending charge-sustaining fuel economy was the most popular option. 4.7% chose a 40-mile all-electric range like the Volt. Click to enlarge.|
About one-third of US new vehicle buying households in the US have both the required infrastructure for recharging and the interest to purchase a vehicle with plug-in capabilities during the nascent phase of the market, according to a new consumer study by researchers John Axsen and Ken Kurani at the Institute of Transportation Studies at the University of California, Davis.
The team observed a “wide diversity” of consumer interests in various design options for plug-in hybrid electric vehicles (PHEVs). The most popular option was improved fuel economy in charge-sustaining mode. They found little evidence of inherent demand for all-electric operation in charge depleting mode, even following education of the participating consumers.
These findings were part of a study attempting to quantify consumer behavior in the early US market for plug-in hybrid electric vehicles. The study addressed four questions:
How aware are consumers regarding electric-drive vehicles?
How many households have regular access to vehicle recharging opportunities?
What PHEV design(s) currently appeal to consumers?
What energy impacts (gasoline and electricity) can we anticipate with significant PHEV sales?
They gathered data from a web-based survey of 2,373 new vehicle buying households distributed across in the US. The survey was implemented in three separate pieces, requiring multiple days for households to answer questions, conduct a review of their own driving and parking patterns, and then complete a sequence of PHEV design exercises. PHEV design priority data were collected in two versions of priority-evaluator games.
Axsen and Kurani found that the majority of new vehicle buyers have little or no familiarity with the idea of a PHEV, and may confuse the capabilities of existing hybrids with those of a plug-in.
This lack of awareness and understanding is both a constraint and opportunity. As a constraint, unaware consumers may simply fail to recognize or identify compelling benefits of owning and operating a PHEV, serving as a soft constraint to limit the market. On the other hand, the early PHEV market in the US may be viewed as a blank slate, with little preexisting understanding of what a PHEV is or expectations of what it should be. Thus, the early actions of automakers, governments, electric utilities and other stakeholders could play an important role in establishing perceptions in the market. Similarly, the first commercially available PHEV incarnations could set an early bar for consumer understanding and set expectations of performance levels.—Axsen and Kurani (2008)
They also concluded that just more than half the population of US households that buy new cars has the potential to recharge a vehicle at home with at least 110-volt service. This is 1.5 to 3 times larger than prior estimates. Few respondents located recharge opportunities at locations other than their homes.
Because recharge opportunities are relatively sparse at work and other non-home locations, we isolate home recharging as the key criteria to characterize a potential early PHEV market in this analysis. This constraint is substantiated by the experience of drivers of PHEV-conversions reported by Kurani et al (2007). We feel that the higher home recharge potential segment identified above provides a conservative yet realistic sub-sample from which to explore the size of early PHEV markets; we limit further consideration of the early PHEV market to the higher home recharge potential segment. We further constrain this segment based on PHEV interest as indicated by purchase intentions in the “high” price condition. Thus, we select the 33.5 percent of respondents that demonstrate both access to sufficient recharge infrastructure and PHEV interest as a group best representing the early PHEV market. We will refer to this subset as the potential early market respondents.—Axsen and Kurani (2008)
Focusing on that segment for the investigation of appealing PHEV designs, Axsen and Kurani found that PHEV performance priorities varied substantially, with no single PHEV design emerging as a favorite of the majority. Improving charge-sustaining gasoline-fuel economy was the most frequently chosen design (41.1%). By the end of the design game process (Round Four), the proportion of potential early market respondents designing a PHEV with all-electric operation rose to 12.3%. Only 4.7% of potential early market respondents chose a PHEV with 40 miles of all-electric range—i.e., the Chevy Volt.
Overall, all-electric operation, a feature stated by some automakers to be essential to assure market success, was not a chosen frequently when points were relatively scarce, i.e. in Rounds Three and Four.—Axsen and Kurani (2008)
After combining all the information from the consumers on driving, recharge potential and PHEV design priorities, the team concluded that the use of PHEV vehicles could halve gasoline use relative to conventional vehicles—the majority of this reduction being due to increases in CS fuel economy.
Impacts to the electricity grid could highly depend on the time-of-day and location recharge management strategy. While unconstrained recharging among PHEV buyers may exacerbate current peak electricity demand, pushing vehicle recharging to off-peak hours through charging controls, time of day tariffs or other means could reduce overall electricity used by vehicles, they concluded.
Overall, this analysis provides a baseline measure of market potential—one that could be highly subject to influence. Recharge infrastructure could expand to a higher percentage of households with changes in building codes, as well as increased employer and publicly installed vehicle recharge outlets. Recharge behavior may also shift with PHEV purchase; owners might adjust driving patterns to maximize electricity use or adjust recharge locations if additional infrastructure is provided away from homes.
Desired PHEV designs and capabilities may be even more subject to change. Survey respondents had little pre-existing understanding of PHEVs and the elicited responses could be sensitive to the PHEV information we provided. As information about PHEV technology diffuses throughout the economy, along with corresponding developments in PHEV values and meaning, interest in particular attributes could shift. For example, all-electric charge-depleting operation could become more meaningful to car buyers as they gain experience and as they participate in the process of identifying just what all-electric operation means to people.
In the meantime, this analysis illustrates how the messages and actions of policymakers, automakers, electric utilities and other interest groups could have significant influence over future development of awareness, recharge potential, design interests, and energy impacts of the PHEV market.—Axsen and Kurani (2008)
Jonn Axsen, Kenneth S. Kurani (2008) The Early US Market for PHEVs: Anticipating Consumer Awareness, Recharge Potential, Design Priorities and Energy Impacts (UCD-ITS-RR-08-22)
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