Electric vehicles are having their best sales year yet in the U.S. — but they still only make up a small fraction of the national passenger vehicle fleet.
Michael Kurzeja, senior manager of corporate strategy, innovation and sustainability at Exelon, asked the audience at GTM’s Power & Renewables Summit last week in Austin, Texas how many of them drive an EV. Even among that plugged-in audience, the response rate was low, with just a few of the roughly 300 attendees in the room raising their hand.
“I think we need to attack this problem from a different perspective,” said Kurzeja.
When Exelon was assessing the EV market a few years ago, the discussion was centered on selling more chargers and getting EV customers on time-of-use electricity rates. Since then, “we came to realize…the purchase of a vehicle is not a rational purchase,” Kurzeja said. People buy cars because they like the paint color, the size or the styling.
“I once bought a car because it had a sunglasses holder,” he said.
“Beyond that, the purchase of an electric vehicle is a lifestyle change,” he continued. “It’s not a simple car purchase, and when you start to look at it from that lens, then you start to see the things happening in the consumer space that are forcing them to make one decision or another.”
Range anxiety is still one of the biggest reasons why consumers don’t adopt EVs, but it’s not the only one, as we’ll explore further in this column. In Part 2, we'll take a closer look at the infrastructure piece and how industry leaders are working to make charging faster, more convenient and overall more consumer friendly.
A recent survey conducted by the University of California, Davis found that despite a near doubling in the number of EV models on offer in California between 2014 and 2017, fewer survey respondents were able to name an EV for sale in 2017 than had been able to do so three years before. The same was true for awareness of state and federal EV incentives — and that’s from a survey conducted in the nation’s largest EV market. Overall awareness is likely even lower in states with fewer EVs on the road.
EV public awareness campaigns aren’t anything new. It's not unusual to see EVs on display at your local farmers market, for instance. But Kurzeja argues that existing methods for promoting EVs aren't enough, and that stakeholders need to think about improving the consumer's entire EV experience in order to see adoption rates significantly increase.
The consumer lens
The first step is to get real.
Do you drive an EV? No? Why not?
“In order to drive the mass adoption we’re all looking for and hoping for, you have to think about it from the consumer lens,” said Kurzeja. “What does their journey look like? And how do you remove the barriers from that system?”
The UC Davis survey revealed that California drivers were no more aware of the state’s expanding public charging system in 2017 than they were in 2014, despite the fact that the number of public charging stations doubled during that time period.
It doesn’t help that each charging network has its own account and billing system, multiplying the work for users and making some charging stations inaccessible. “I don’t want to have to carry 15 different key fobs to hook up,” said Kurzeja.
Exelon’s EZ-EV program was designed to provide a seamless customer experience through the entire journey of owning an EV — from researching a vehicle, to making the purchase, to charging. The EZ-EV website offers tips to prospective owners, an “EV-Bot” to help match members with a vehicle, and helps users find deals.
Other utilities are looking to play a similar role in becoming the trusted source of EV information. For instance, Sacramento Municipal Utility District is working with the software and data firm ZappyRide to engage with customers, develop EV web tools, connect with dealers and more. ZappyRide's platform is also used to power Electrify America's media campaign Plug Into the Present. But it's still early days for programs like this.
Kurzeja thinks about the entire EV adoption process as a tension system — incentives and marketing push people to make an EV purchase, while barriers hold them back. Most of the barriers are well-known: price, range and product diversity. Expanding EV charging and improving the dealership experience are also important.
Then there are more nuanced issues, like understanding a renter's versus a homeowner’s EV experience or getting a condo board to approve a Level 2 charger in a multi-family building (something a friend of mine is struggling with).
“There’s no silver bullet” to solving these issues, said Kurzeja. “But if you focus on that tension system and you focus on making ways to smooth the transition for a consumer to make the switch naturally, that’s when you’re going to see adoption in the double digits. [...] But doing it like we have for the last 10 years, we’re going to continue to see…tepid adoption.”
Making EVs cool
One big difference between the EV market of today versus years past is that the cars themselves have become much more compelling. They’re no longer “Happy Meal boxes” or “oversized golf cars,” Kurzeja said.
Tesla in particular has to be credited with pushing virtually all other automakers to make better-looking EVs outfitted with the latest tech and amenities. “Tesla [took] a stand and made electric vehicles cool,” he said.
When it comes to the “cool factor,” there may be some lessons the industry can learn from Circuit of the Americas, the Austin-based Formula 1 raceway.
Sustainability was baked into the racetrack’s business model from its launch in 2012. The Circuit offsets carbon emissions, maintains onsite wildlife preserves and habitats, has a robust recycling program, and even produces its own honey from the 5 million bees that live on-site. Next year, the Austin raceway will feature zero-emissions electric motorcycle racing for the first time.
Edgar Farrera, director of sustainability at Circuit of the Americas, who spoke at GTM’s Power & Renewables Summit last week, said managing the public relations around these types of initiatives is a balancing act.
“Primarily our guests come out to build memories and have a fun experience at a music concert or motorsport event,” he said. “So it’s important we present our sustainability initiatives to them, but have to be careful not to hit them over the head with it.”
The racetrack gives away merchandise and leverages the fame of the drivers and motorcycle riders in order to get the message out in an engaging way and to as many people as possible.
“If I plant a tree and call the press, nobody shows up,” said Farrera. “But if I’ve got a world champion…planting a tree, I’ve got media from Russia, Brazil, from Spain — from all over the world.”
“In terms of decarbonizing Austin, will one tree make a difference? Not really,” he added. “But in terms of magnifying the messaging and getting it out there, sports are very powerful in that regard.”
The Formula E racing circuit (which does not run at the Austin track but does hold races in the U.S.) was created in part to make these “green” vehicles sexy among sports fans. At least from a media coverage perspective, the idea seems to be working.
While giving away gear and hiring celebrity spokespeople may sound gimmicky, the survey numbers cited above indicate that the EV sector could probably benefit from adopting more of these mainstream marketing techniques. EV ad campaigns have historically led with the environmental benefits of these vehicles, but that approach arguably limits the potential buyer pool, while on the other hand, highlighting features like performance has been found to resonate with a broader audience.
Industry and policy leaders are aware of the need for a larger number of unique EV marketing initiatives. That’s why a coalition of automakers, electricity providers, charging network companies, policymakers and nonprofits recently launched a new organization in California called Veloz, with the aim of marketing EVs to a wider audience. Its first task is to launch a large multi-stakeholder and multimillion-dollar public awareness campaign in North America.
If you take Kurzeja's word for it, how effective these efforts are at adopting the "consumer lens" will determine how successful they are overall. That not only goes for marketing, but for the entire customer journey. In the next column, we'll look at how EV ecosystem leaders are thinking about improving the consumer experience when it comes to charging.