Electric Car Purchase Price as a Factor Determining Consumers’ Choice and their Views on Incentives in Europe

Abstract

The deployment of zero-emission vehicles has the potential to drastically reduce air pollution and greenhouse gas emissions from road transport. The purpose of this study is to provide evidence on, and quantify the factors that influence, the European market for electric and fuel cell car technologies. The paper reports the results of a stated preference survey among 1,248 car owners in France, Germany, Italy, Poland, Spain and the United Kingdom. The variables that influence powertrain choice are quantified in a nested multinomial logit model. We find that the electric car purchase price continues to be a major deterrent to sales in the surveyed countries. The majority of the respondents considered government incentives as fundamental or important for considering an electric car purchase. Because of the differences in the socio-economic characteristics of consumers in each country, the effectiveness of government incentives may vary across Europe.

How Policies Affect the Dissemination of Electric Passenger Cars Worldwide

“…Low costs for BEVs alone did not ensure high EV dissemination. Nevertheless, the high price of BEVs was still a barrier [14]. Non-monetary incentives, combined with indirect policies such as high registration taxes and high fuel prices, are highly effective.…”

“…In summary, the most important factor was not direct subsidies but road priority (access to high-occupancy vehicle lanes (HOVs) and bus lanes). The study by Vilchez et al [14] identified factors that influenced the EV market in Europe. They concluded that the purchase price of EVs was still a barrier.…”

The Tax Incentives in the IVTM and “Eco-Friendly Cars”: The Spanish Case

“…However, we must also consider the position of [11] when the authors indicate that "more subsidies do not always involve more sales" or greater acceptance, purchase, and use of the electric vehicle. This last position is also shared in [12] and [13], studies on reducing incentives for the purchase of electric vehicles in the European Union. At a more local level, studies have also been carried out on the effect of incentives via electric vehicle subsidies in Norway and the Netherlands, where different scenarios for the subsidization of electric vehicles and their effects were analyzed [14]; in Denmark, along with the incentives for its purchase [15], some psychological factors were also added.…”

Prospects for Electric Vehicles

“…How large a premium can vary from model to model, but it inevitably increases the first-time costs of EVs. It may be that the lifetime costs of a EV are less than those of a conventional vehicle, due to its lower operating costs, but surveys have shown that the initial purchase price of a vehicle plays an inordinate role in shaping consumer purchase decisions [26]. Short-term perspectives, therefore, trump long-term considerations.…”