Electric Vehicles (EV) are becoming more and more popular. There is supposed to be a significant growth of EVs leading up to 2030, and Energy Solutions wants to help customers understand the reasons for it and encourage them to switch to EVs and install EV charging points. Last year Deloitte released a report on how the sales of Electric Vehicles are likely to change before 2030. In the report, they analysed changes in specific EV markets, including the UK. Below you can find the key findings of the report.
Deloitte specified that in the report the term electric vehicles (EVs) is used to refer to battery electric vehicles (BEVs), as well as plug-in hybrid electric vehicles (PHEVs). BEVs refers to vehicles powered solely by batteries. They include an electric motor which turns the wheels. They don’t produce any emissions. PHEVs, on the other hand, can produce zero emissions when driving short distances between 20 and 30 miles. If customers want to use them for longer trips the PHEVs can then run on petrol or diesel. In order to be able to perform zero-emission driving, they need to be plugged in to an electricity supply and charged before the trip.
Characteristics of the EV market in the UK
In November 2019 Deloitte gathered 1,496 people from the United Kindgom who were thinking of buying a car in the next three years. They conducted a survey in which they asked them what types of cars they were considering. More than half of respondents stated that they were thinking of getting an Electric Vehicle. Only 35% of participants said they were considering a petrol or diesel car. That means that the sales of EVs in the United Kingdom are on the rise. Nevertheless, according to the Deloitte’s report 2 years ago BEVs and PHEVs combined had only 3.1% share of the market.
A year later, in 2020, BEVs and PHEVs had 9,1% of the market
Based on the market analysis, Deloitte reports that 56% of adults believe they will most likely purchase a car in the next three years. That translates into a total market of about 30 potential buyers.
The impact of COVID-19 on the EV market in the UK
Deloitte observes that the restrictions introduced in the United Kingdom to stop the spread of coronavirus had a negative impact on the automotive retail market. Over lockdown, people did not have the need to travel and commute as often as before, hence they did not have the need to purchase new vehicles. Even when the restrictions are fully lifted many customers who have been experiencing financial difficulties as a result of the situation may engage with the sector differently.
Consumer research carried out by Deloitte reveals that because of the pandemic almost 50% of consumers plan to keep their current vehicles longer instead of purchasing new ones.
Deloitte speculates, however, that as because of the pandemic fewer people decide to use public transport and car-sharing apps, in the short them that will bring high demand for second-hand cars, and the long term it will trigger increased demand for EVs.
Priorities for acquiring EVs
In 2018 and 2020 Deloitte asked consumers from several countries what their biggest concerns regarding switching to EVs were. The table below contains the survey results for the UK. The percentages describe how many people mentioned a certain concern.
|the time required to charge||13%||16%|
|lack of charging station||22%||33%|
From 2018 to 2020, consumer attitude has changed. The most significant changes can be observed in concerns over the cost and in lack of charging station. The former diminished, while the latter increased.
Deloitte expects that over the next few years some concerns will be eliminated. EVs are going to continue to grow in popularity, hence more and more models will be available. That will be followed by lower prices. Moreover, the driving range, which describes how far a car can travel with a given amount of fuel, of EVs and ICE vehicles is already comparable. Over the next few years, new technologies will be developed to make EVs even more efficient and lower the overall costs of ownership. That is why the concern about the cost of EVs won’t be a problem anymore.
The fact that the number of people who expressed their concern about the lack of charging station shows that more and more people are considering acquiring EVS. It is becoming increasingly popular for people to install charging stations and getting them set up is now easily accessible. As EV sales continue to grow, it can be expected that charging stations will be more commonly installed.
Deloitte also predicts the proliferation of commercial EVs, which can include vans, trucks, or lorries, and the rise of electric public transport options. That will further popularise switching to EVs.
In the report, Deloitte outlines three customer profiles that explain the behaviour of customers in the UK. They can be classified based on their household income. The table below contains an overview of the three customer portraits with their key characteristics and information on how to target them.
|income||key characteristics||ways to target them|
|£25k – 50k||● likely to buy from a traditional dealer |
● very interested in knowing more about charging time
|● providing options to buy used EVs |
● promote smaller, cheaper models
|£50k or less||● most interested in knowing more about technology |
● concerned with environmental impact
|● give recommendations for smart charging |
● invest in innovative, sustainable retail
|£50k – 100k||● not concerned with environmental impact |
● interested in knowing more about battery range and charging time
|● come up with a transition strategy for loyal customers to facilitate switching to EVs and minimise the risk they will change brands |
● promoting large, executive models
Developing customer portraits serves to explain which groups are most likely to purchase EVs.
EV growth after 2030
As the Deloitte’s report indicated many people in the UK consider environmental reasons as the biggest advantage of switching to EVs. They expect the rate of growth of EVs to continue growing for a few years after 2030 and then slow down but the number of electric car users will stay high.
This scenario is in line with what the National Grid predicts. According to their research, the UK will face a rapid adoption of EVs over the next few years. The most recent prognosis, developed in 2018, is illustrated by the red line in the graph below.