Will 48% of Us Really Buy a Plug-in Car?

By Bill Moore

Posted: 12 Sep 2009

Much has been made of Pike Research's recently released study that found 48% of those polled were "extremely" or "very" interested in purchasing a plug-in electric vehicle with a 40-mile electric range.

The study further found that "82% of respondents drive 40 miles or less per day, with an average daily driving distance of 27 miles." This suggests that the idea of using cheaper electric power to drive to and from work clearly appeals to a significant fraction of the driving public. An even higher percentage, 85%, told the researchers that "improved fuel efficiency would be an important factor when choosing their next vehicle."

What Pike also uncovered was that 65% of the people they surveyed were, in fact, willing to pay a "premium price, over and above the price of a standard gasoline vehicle..." How much of a premium? 12 percent. Translated into practical terms, the average price of a 2009 Saturn VUE, which GM had originally proposed offering in a plug-in version, is $25,520. A twelve percent premium is $3062. This means GM would have had to offer the VUE plug-in at $28,582 in order to interest those 65% of buyers. They might have been able to come close to this with a 10-20 mile range blended mode hybrid using a 5 kWh battery pack costing $2,500, which is an achievable number given GM's recent announcement that the Volt battery pack will cost $500/kWh. That 40 mile number would be a lot harder to achieve at that price.

But all this presumes people are honest in their answers when asked these types of questions. Research has demonstrated that people often give responses that are based not on what they actually can or intend to do, but what they would like to do. I would love to own a Yuneec electric airplane so I can get back into flying, but do I intend to actually lay out nearly $90,000 to buy one. Not in this life on this planet.

What we aspire to isn't always what we can practically achieve or acquire. Okay, 48% of those Pike polled are extremely or very interested in something like the Chevy Volt. That's a promising sign given that 24 months ago few people even knew what a plug-in hybrid was. But when the Volt rolls into Chevy dealer showrooms early in 2011, will those same people be willing to lay out hard cash or sign seven year car loans to own or lease one?

If you go back and watch GM's 1990 corporate video on the EV1 electric car, you'll find similar buoyant public responses that would lead you to believe that everyone will want to own the car when it became available starting in 1996. Regrettably, they didn't. We can blame GM for poor market execution, but the fact remains, they needed to sell tens of thousands to these cars to make economic sense and they couldn't, or they wouldn't.

I hope that those 48% are sincere and expressing their intentions and not just their aspirations, which can be based largely on how we see ourselves: environmentally aware and socially-responsible. But when it comes to opening the pocket book or writing that check, a more pragmatic creature often emerges and we start counting pennies, which are far more tangible than grams of CO2.

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