It’s the Features, Stupid: EV Market Share Is Growing Because the Vehicles Keep Getting Better

Electric-vehicle market share has soared in the last decade, but there has been no measurable change in the share of consumers who want to buy an EV just because it’s an EV.

This finding, from a recent paper in Proceedings of the National Academy of Sciences, indicates that the growth in demand for EVs is largely due to the appeal of the models’ technology and features, not a deeper attachment to the idea of owning an EV than in the past.

The results were surprising to Kenneth Gillingham, a Yale University economist and co-author of the study. “I went into it actually expecting to see some pretty notable changes in consumer preferences,” he said.

He embarked on the research project thinking that the number of people who are predisposed to wanting an EV would have risen in the last decade.

While some car buyers may indeed want an EV on principle—like many of the early adopters who helped the vehicles get their first couple of percentage points of market share—researchers report that the size of this group does not appear to have changed. Meanwhile, EVs made up 7.2 percent of the market for new cars and light trucks in the first quarter of this year, more than double the share from two years ago, according to the research arm of Cox Automotive.

Or, as another co-author of the study, the Carnegie Mellon University engineering professor Jeremy Michalek, puts it: “Consumers haven’t changed. It’s technology that’s driving EV adoption.”

What does this say about the EV market?

It means that as EVs improve their features, the rapid rise in sales should continue. The features helping to drive sales include long battery ranges, fast acceleration and low costs for maintenance. But these specifics don’t quite capture the appeal of the whole package, which is that many consumers find EVs to be fun to drive in terms of ride quality in a way that gasoline vehicles are not. 

Also, it’s important to note that this most recent survey of prospective buyers was conducted in 2020 and 2021, before the introduction of some intriguing technologies, like the ability of an electric vehicle to provide battery backup to a house, were available.

The biggest factor hindering EV demand is that the models are more expensive than equivalent gasoline models, the paper finds. But the cost gap is shrinking, which should help with growth in market share.

“This is positive news because it’s showing that even when we’re talking about mainstream consumers, they’re still valuing the attributes” of all-electric vehicles, said Kate Whitefoot, another co-author and engineering professor at Carnegie Mellon. “And as we continue to see increases” in a range of [EVs] and “dropping prices relative to gasoline vehicles, more and more mainstream consumers will choose electric vehicles.”

The paper is based on answers to online questionnaires from 734 people who planned to buy a car and 862 people who planned to buy an SUV in 2020 or 2021. The authors compared the responses with those from a survey conducted in 2012 and 2013.

Whitefoot emphasized that the results present a picture of all car and SUV buyers, as opposed to zeroing in on people who already drive EVs or plan to buy an EV.

The authors also drew on projections of advancements in vehicle technologies from the National Academies of Sciences, Engineering and Medicine and predicted what consumer preferences might look like in 2030.

They found, for example, that a majority of consumers would choose the projected 2030 version of an EV like the Nissan Leaf when given a choice between that and the 2030 version of an equivalent gasoline model, the Nissan Versa.

The main differences between now and 2030 would be in cost and battery power. The price gap between the Leaf and the Versa would be less than half the $10,000-plus that it is today before tax credits. And the Leaf is projected to have about 300 miles of range on a charge in 2030, compared with 149 miles today.

Some of these findings seem obvious. Of course, a decrease in the price premium for an EV will help sales, as will increases in battery range.

What’s striking isn’t that those factors matter. It’s how much they matter. The change in prices and the improvements in features will have a strong influence on what consumers are considering when they go to the dealership, even if they have no other reason—air pollution, climate change worries, public reputation—to favor an EV.

I asked Gillingham to spell out the main factors that could prevent this shift in the market from happening as quickly as he expects.

He listed three. Automakers may not have enough EVs available to give consumers a range of choice between equivalent gasoline and electric options; a lack of adequate charging infrastructure could slow the growth of people’s willingness to buy EVs; and the projections of technological advancements from the National Academies could turn out to be overly optimistic.

That final point touches on some of the most complex elements of the transition to EVs, like the availability of lithium and other battery materials and the speed in development of next-generation batteries that have much longer ranges.

But that’s enough throat-clearing. The larger point is that we’re heading to a market in which EVs will be the leading options largely because they have better features. In that market, we may stop thinking of them as EVs. As others have said before me, they’ll just be cars.

The U.S. Clean Energy Manufacturing Boom Has Begun: Starting with a visit to the groundbreaking for a plant that will make long-duration batteries in West Virginia, Canary Media has a series of articles this week about the clean energy manufacturing boom. “The scale and speed of the shift has been stunning,” writes Julian Spector. “Clean energy is no niche industry anymore; it’s become a pillar of the national economy. And now that climate-friendly technologies are bringing eye-popping job and investment packages, the states most resistant to climate policy have proven themselves the most enthusiastic adopters of the factories.”

Mining Vital to Renewable Energy Is Tied to Hundreds of Human Rights Abuses: Hundreds of alleged human rights abuses have been committed by over 90 corporations that are mining minerals critical to the production of clean energy, my colleague Katie Surma reports, citing tracking by the Business and Human Rights Resource Center. The center says the abuses arise from the failure of the United States and other nations to develop appropriate labor and environmental safeguards in the mining regions involved, and calls for the issue to be addressed immediately.

Regardless of What Mr. Bean Says, EVs Are Much Better for the Environment than Gasoline Vehicles: The comedian and actor Rowan Atkinson wrote last week in The Guardian that he felt “duped” by the promise that electric vehicles are better for the environment. I wrote for ICN about how Atkinson’s piece is touching on some familiar and misleading tropes used by people and groups with a financial interest in slowing the transition to EVs. Auke Hoekstra, a sustainable energy researcher in the Netherlands who has become a leading debunker of such arguments, says Atkinson’s article is “cranky nitwittery.” There is voluminous evidence that EVs are much better for the environment than gasoline vehicles, and I include links to some of it in my story. It’s important to specify that there are legitimate concerns about the growing use of EVs, like the human rights issues mentioned just above. But the problems with EVs can be reduced or fixed. There is no substantive fix for the environmental harm caused by the production of fossil fuels and burning those fuels in engines.

Hundreds of Localities Restrict Renewables Siting, with 293 Projects Currently Contested: A report from Columbia Law School found 228 local restrictions on renewable energy development in 35 states and identified 293 projects that have drawn significant opposition in 45 states, as Diana DiGango reports for Utility Dive. The report shows some of the big picture that I spent much of last year exploring in my Solar Opposites series.

New Jersey Puts Clean Energy Bill on Hold: New Jersey’s governor and legislative leaders would like to pass the most ambitious clean energy law in the country, but they’re not going to do it right away, as Ry Rivard reports for Politico. The bill would set a path for the state to get to 100 percent carbon-free electricity by 2035, which is really soon for a shift of that magnitude. The measure has support, but legislative leaders are now saying they’re going to wait until after the November election. I’ll be following this one, as New Jersey is poised to join Minnesota and other states with landmark clean energy bills in 2023.

Electric Vehicles Appeal to Conservative Buyers Sick of Gas Guzzlers: Some reliably Republican counties in Texas have EV market shares that are higher than the national average, indicating that the vehicles have an appeal beyond the stereotype of the tree-hugging early adopter, as Jeanne Whalen reports for The Washington Post. I’m not surprised to see these findings, which are based on county-level data from S&P Global Mobility. They’re also in line with what the Yale and Carnegie Mellon researchers learned in the surveys I write about above.

Inside Clean Energy is ICN’s weekly bulletin of news and analysis about the energy transition. Send news tips and questions to [email protected].