McKinsey Quarterly Sees 'Fast Lane' for Electric Car Deployment
As more and more electrified vehicles hit the floors of car dealerships, conventional wisdom has it that the market won’t get moving without richer incentives and dense battery-charging networks.
Yet our research on demand for electric cars in very large urban areas1 shows that plug-in hybrid electric vehicles and battery-only electric vehicles could account for 16 percent of overall new-car sales in New York, 9 percent in Paris, and 5 percent in Shanghai by 2015. That’s true even with today’s financial incentives and limited public charging facilities.2
It’s not surprising that the market may take root in big cities: nowhere is the need for cleaner air and reduced carbon dioxide emissions more pressing, and nowhere else can you expect to find as many green-minded early adopters who will welcome a clean vehicle that takes them the short distances they need to go on one charge. These characteristics make large urban areas the ideal labs for the next phase of electric-vehicle development. Our research offers insights that can guide auto companies, battery makers, infrastructure providers, and city governments alike as they consider moving forward with this technology and the networks that support it.
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