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Deloitte: interest in hybrid vehicles still significantly outpacing full battery-electrics

As global auto manufacturers continue to invest in electrified vehicle (EV) production, internal combustion engine (ICE) powertrains dominate future US intentions, with 69% of US consumers looking to retain the technology for their next vehicle, according to Deloitte’s 2022 Global Automotive Consumer Study report.

This year’s report explores a variety of issues impacting the global automotive sector, including the development of advanced technologies, sustainability, cost expectations on new vehicles, virtual purchasing experiences and mobility services. The report is based on a survey of more than 26,000 consumers from 25 countries conducted between September and October 2021.


Source: Deloitte.

As global automakers look to make good on their promises of an electrified future, consumer interest in adopting more sustainable powertrains is driven by reduced fuel costs, climate concerns and better driving experiences. However, EV limitations continue to draw many drivers to familiar internal combustion engine (ICE) vehicles. At the same time, consumer willingness to pay for advanced technologies remains limited.

Despite a growing interest in sustainability, a majority of consumers are still unwilling to pay more than US$500 for advanced technologies including alternative powertrains, including in the US at 53%. Further, consumers are unwilling to pay for other advanced features including autonomous driving, enhanced safety and connectivity.

As a result, ICE vehicles continue to dominate future US vehicle purchase intentions (69%). Among alternative powertrains, consumer interest in battery electric vehicles (BEVs) is highest in the Republic of Korea (23%), China (17%) and Germany (15%), while Japanese consumers showed the highest preference towards hybrid electric vehicles (HEV/PHEV) (48%) followed by the Republic of Korea (35%).

However, mounting concerns about climate change and reducing emissions are consistently among the top two motivators for electric vehicle adoption among global consumers in the US, Germany, Japan, the Republic of Korea, India and Southeast Asia.

The majority of EV intenders expect to charge their vehicles at home, particularly in Japan (76%), India (76%), the US (75%) and Germany (70%). Demand for public charging is highest in the Republic of Korea (38%) and Southeast Asia (29%).

Among those planning to charge their vehicles at home, two-thirds (66%) of Americans will leverage traditional power grids. Meanwhile, consumers in India, China and Southeast Asia plan to use both the regular grid and renewable power.

Driving range is the top concern about EVs across consumers in Germany (24%), China (22%) and the US (20%), whereas the lack of public charging infrastructure is top of mind in Asia (Southeast Asia at 28%, the Republic of Korea at 26%, India at 23% and Japan at 19%).

US consumers expect fully charged EVs to travel upwards of 500 miles, while those in China, Japan and India are content with a range of around 250 miles.

Shared mobility offerings, including vehicle subscriptions and ride-hailing services, face a slow return to pre-pandemic levels as personal vehicle ownership maintains its position as the most desirable mode of transportation, according to the study.

More than three-quarters of Americans (76%) indicate personal vehicles as their primary means of transport. However, public transportation has a significant share among consumers in the Republic of Korea (31%) and Japan (27%). Vehicle subscription services are more popular in global markets, yet still gaining interest in the US.

Approximately one-third of US consumers are interested in vehicle subscription services for access to different car models, brands of vehicles and pre-owned vehicles (each at 32%). Convenience, the flexibility to exchange vehicles, and the availability of vehicles are the main drivers for engaging a vehicle subscription service in the US.


This reported consumer preference:

> US consumers expect fully charged EVs to travel upwards of 500 miles

Shows why reports like this must not be taken at face value, but interpreted very carefully.

The typical American driver only makes 1-2 long trips per year.

Except for a vanishingly small number of drivers who routinely take long drives, this is an education problem, not a technology/capability problem.

Tesla drivers routinely make 500 mile drives with two stops after 3 hour legs. These combined charging/meal/math room breaks add a very small delay vs a typical gas+food stop.

The fuel cost savings on these long trips is about $60 each way, $120 round trip.

The lifetime fuel cost savings of all electric travel is $15-25,000.

How many consumers do you know who are really willing to pay those premiums for a 60 minute time savings twice a year?

Uneducated consumers want a faster horse and buggy.

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