Market Promotion of Electric Vehicles


2018-10-07

Electric Vehicles (EVs) are vehicles that run on electricity instead of conventional internal combustion engines that rely on fossil fuels. EVs are powered by electric motors and use rechargeable batteries or other energy storage systems to store and deliver energy to the motor. The history of electric vehicles dates back to the early 19th century, but very few people actually own an electric vehicle, therefore electric vehicles have inadequate market achievements.

Avant Garde Solutions conducted a market survey among 411 samples from Kathmandu, Bhaktapur, Lalitpur, Banke, and Rupandehi. The survey used both quantitative and qualitative approaches to analyze the results. The aim of the study was to analyze customers' perceptions of EVs, factors that affect attitude formation towards EVs, are customers' intent to adopt EVs and replace fossil fuel-consuming vehicles.

The survey questionnaire used purposive sampling, which is a non-probability sampling technique in which respondents are selected because they have characteristics that are required in a sample, in this case, the survey questionnaire was conducted among Non-EV users. The quantitative approaches used in the analysis are Frequency Distribution, Descriptive Statistics, Regression, and Thematic Analysis of qualitative data.

 

 

 

Among 411 respondents, 86.9% of them were male whereas 12.9% were female. 79.6% of respondents lie below the age group of 45 years, among them the age group 26-35 years owned the highest number of car owners, i.e. 32.7%.  Similarly, 43.80% of respondents completing Bachelor's degree and 41.61% completing a master's degree owned a car. Talking about the occupation of the respondents, most of the owners were involved in private services, 41.4% worked as private service providers whereas 32.6% of them were self-employed.

 

 

Among Non-EV users 90.8% used the vehicle for less than 10 years. Most of the time vehicle was used to commute from home to the workplace, which accounts for 80.5%. 76.9% used the vehicle for family use, likewise, 44.3% used the vehicle for short drives.

 

 

 

Among the respondents owning a car, 19.2% possess a second car whereas 80.8% of them didn’t possess a second car. Of people owning a second car, 65.82% only owned one car as a second car, and 24.05% owned extra two cars as their second car.

When asked with the Non-EV users, if they want to buy EV in the future, 54% responded they wanted to buy one, 21.2% didn’t want to own an EV in the future, and 24.8% of respondents weren't certain if they wanted to buy or not in the future.

When asked the respondent reason behind wanting to buy an EV, most of the responses were concerned regarding the environment as the most positive factor of owning an EV lies in reducing pollution and uplifting the environment, followed by low operation cost and lower regular maintenance cost. 

 

 

 

 

  

 

Likewise, when asked the reason behind not wanting to buy an EV, 76.16% of the responses were due to the unavailability of charging stations, followed by the high price of the vehicle and high battery replacement cost.

Respondents, whose responses were against buying EVs were asked about the factors that might encourage them to buy the vehicle in the future. 80.4% of responses were about the availability of fast charging stations, availability of maintenance stations, prices cheaper or in line with gasoline, and many more.

With the collected data, a regression test was run regarding the perception of electric vehicles. The perception towards buying an EV depends on the quality of the EV, low tariff, awareness, and low operation and maintenance cost. The regression results show 35.9% significance among the dependent variable i.e. perception towards EV and other independent variables mention above. Likewise, the regression results indicate that price, promotion, and environmental concern have no influence on attitude formation toward EVs. Likewise, adoption intention towards EV is formed through attitude towards EV.

 

When conducting a Focus Group Discussion (FDG) among Non-EV users regarding owning an EV. The discussion resulted in the conclusion that Electric Vehicle is really expensive to consumers even though the custom tax paid by the users is low. Most of the respondents were unaware of EV features like distance traveled at full charge, safety issues, and price of spare parts. Many people don’t prefer buying EVs due to the lack of expertise for maintenance, and very few options available to choose from. The major conclusion from FDG regarding issues of owning an electric vehicle was lack of fast charging stations, low vehicle pickup, short battery life, high battery replacement cost, constant voltage supply, no resale value, and lithium-ion battery disposals.

In-depth interview was conducted among the EV users regarding their experience using the EV. Many respondents were concerned regarding the high price of electric vehicles compared to gasoline vehicles. Those who own and drive an EV, use it as a city car and haven’t actually driven the car outside Kathmandu City. The responses regarding the comfort of the car were positive. The operation and maintenance cost is also said to be low. There is the availability of an easy charging port at both office and home of the respondents. The car is not very reliable for long route commutes.

Similarly, an In-depth interview was conducted among government stakeholders. The government had a plan to increase the sale of Electric vehicles by 20% by 2020 AD. For the EV user's government plans to impose low custom duty and road tax to encourage more people to switch their vehicle preferences. The government is currently working on setting up charging stations in many places. On the contrary, the government currently has no battery disposal plan and modality.

When interviewing the dealers of Electric Vehicles. They argue that the EV market is growing in comparison with its pre-introduction and experimental phase. There is said to be no aggressive promotion of the vehicle in the market. The sales of the vehicle are limited as there is no infrastructure to sell in the large volume. People switching from gasoline-consuming vehicles to electric vehicles is very low. The dealers also agree with the low pick-up of the vehicle.

In conclusion, to increase the use of electric vehicles among car users, the main focus should be on the availability of charging stations. There should be enough market promotion regarding the unique feature of the vehicle so that many people are aware of it. Likewise, there should be a mechanism to manage the battery disposal of the vehicle. The users and the dealer of the vehicle aren’t very fascinated by the pickup of the vehicle.