Photo: Michael Graham Richard
But People Always Say That...
Ask people if they want to pay more for something - especially something they are not entirely familiar with - and chances are that the default answer will be "no". That's quite expected. So when Nielsen asked citizens of the U.S. and of the U.K. if they would consider buying an electric car (yes!) and how much extra they were ready to pay (nothing!), the results weren't very surprising.
Photo: Michael Graham Richard
When asked if they would be willing to pay more for an electric car than the cost of a conventional car, 65% of U.S. consumers said they did not want to pay more for electric cars. In the U.K., more than three-quarters (76%) were unwilling to pay more. Of those who accepted the price differential, slightly more than half of consumers in both countries (51% U.S., 57% U.K.) said they would not be willing to pay more than $5,000 above the average price of a standard vehicle. (source)
The Apple Effect
If you ask people in the abstract if they are willing to pay more for a computer that is more expensive than most computers and can't do some things that others can (most games won't work, most software you already have probably won't be compatible, etc), they'd certainly say "no". Yet Apple is approaching a 300 billion dollars market value because it makes products that lots of people are ready to pay extra for. That's what electric car makers need to do, at least until they can reduce prices through economies of scale and technological breakthroughs.
The parallel isn't perfect. Cars aren't consumer electronics. But the general idea still stands: Enough early adopters can be convinced to buy EVs as long as automakers make sure that they have some clear benefits over non-EVs. Some green will be ready to pay more just for the reduced pollution, other people might be interested in the high-tech factor, or the gobs of low-RPM torque, or the low cost of operation and not having to stop at the gas station. Some luxury buyers might go electric for the eclusivity (no doubt some Tesla and Fisker buyers will fall in that camp).
I'm not under the illusion that this will convince everybody, but it doesn't need to. It just has to bring enough people on board for EV development to continue at a good pace and for economies of scale to take hold. If we can reach that point, before we know it a few years will have passed and there will be many more EV models competing on the market, prices will fall close to regular cars (the Nissan LEAF is already decently close, especially after incentive and if you count fuel savings over the life of the vehicle), batteries will improve, bringing range to 200-300 miles, and fast-charging stations will be easy to find. There's also a high probability that gas and diesel prices will go up because of oil scarcity and because a price will eventually be put on carbon, which will make EVs even more desirable.
Give Early Adopters a Reason to Pay More
So automakers, you need to invest a lot in R&D; and design to make really great electric cars that as many people as possible will be ready to pay a little extra for (after all, people already pay quite a lot for extras that won't pay for themselves, like sunroofs and big engines and mag wheels), but don't worry if no everybody's interested at first. You can't convert everybody at once.
Via Nielsen, Edmunds
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