1998 will be a big year for both automakers and clean-air advocates. In less than three years, the seven largest car sellers in California must sell zero-emission vehicles (ZEVs) - 2 percent of their sales of vehicles under 3750 lbs loaded weight. Given the size of the current market, that's about 20,000 vehicles and they most likely will be electric cars. By 2003, 10 percent must be zero-emitters. 

The crux is that the government requires the auto industry to put ZEVs on the market without requiring consumers to buy them. The big manufacturers say electric cars cost too much to make and consumers won't choose them, even if prices were to match those of gasoline vehicles. The automakers have threatened to raise the price of gasoline vehicles to offset their losses. Much of the debate hinges on just how many Californians - or other car buyers throughout the world - will want an electric vehicle (EV).

We report the results of a survey of the potential demand for electric vehicles

(EVs) among a subset of California households. We limit our analysis to one group

of potential hybrid households. These households own two or more light duty

vehicles and buy new vehicles of the body styles we expect will be offered as

electric vehicles. These characteristics identify households who may be able to

incorporate at least one limited range vehicle into their hosehold vehicle

holdings with no, or minimal, affect on household lifestyle choices. We define

hybrid households to be those households that choose an electric vehicle in the

choice exercises in the survey. We formulate our central research question as the

hybrid household hypothesis. It states that potential hybrid households will

choose to include at least one EV in their household fleet of vehicles, thus

becoming hybrid households.

We believe that this subset of potential hybrid households buys between 35 and 45

percent of all new, light-duty vehicles sold in California every year. The survey

instrument was administered to households who belong to this subset of households

in 6 metropolitan areas of California. Four hundred and fifty-four households

completed and returned the questionnaire.

The hybrid household hypothesis is supported by our respondents' choices. In two

different choice scenarios, nearly half our sample indicates they would choose an

electric vehicle as their next new vehicle. Even among those who indicate their

next new vehicle would be either a gasoline or natural gas vehicle, some indicate

they would choose an EV at some point in the future.

Based on the responses to the vehicle choise exercises and on the share of the

market that our sample represents, we find the market potential for EVs to be 13

to 15 percent of the annual new light-duty vehicle market in California. Based on

past annual sales of 1.4 million new, light-duty vehicles in California (a typical

market during the past few years), the EV market share represents between 186,000

and 213,000 vehicles annually. This is subject to several assumptions, most

importantly that, besides smaller EVs, consumers will be able to choose from

midsize EVs that have driving ranges between 60 and 150 miles and that EVs will be

priced comparably to gasoline vehicles. Even if the former is not true, and only

sub-compact and compact body styles are available, the potential market for EVs

among hybrid households will be no less than 7 percent of the new light-duty

vehicle market.

We belive therefore, there is sufficient household consumer interest in EVs to

satisfy the mandated 2 percent level of sales of zero emission vehicles (ZEVs) in

the year 1998 as well as the 5 percent level in 2001 given current EV

technologies. To meet the mandated level of 10 percent light-duty vehicle sales in

the year 2003, will require either that advances in electrical storage technology

allow for mid-size electric vehicles with driving ranges of 60 to 150 miles or the

sale of sufficient smaller EVs to the market segments not surveyed for this study:

comercial and governemtn fleets and households that do not meet the potential

hybrid household definition used in this study.

We report the results of a survey of the potential demand for electric vehicles (EVs) among a subset of California households. We limit our analysis to one group of potential hybrid households. These households own two or more light duty vehicles and buy new vehicles of the body styles we expect will be offered as electric vehicles. These characteristics identify households who may be able to incorporate at least one limited range vehicle into their household vehicle holdings with no, or minimal, affect on household lifestyle choices. We define hybrid households to be those households that choose an electric vehicle in the choice exercises in the survey. We formulate our central research question as the hybrid household hypothesis. It states that potential hybrid households will choose to include at least one EV in their household fleet of vehicles, thus becoming hybrid households.

We believe that this subset of potential hybrid households buys between 35 and 45 percent of all new, light-duty vehicles sold in California every year. The survey instrument was administered to households who belong to this subset of households in 6 metropolitan areas of California. Four hundred and fifty-four households completed and returned the questionnaire.

The hybrid household hypothesis is supported by our respondents’ choices. In two different choice scenarios, nearly half our sample indicates they would choose an electric vehicle as their next new vehicle. Even among those who indicate their next new vehicle would be either a gasoline or natural gas vehicle, some indicate they would choose an EV at some point in the future.

Based on the responses to the vehicle choice exercises and on the share of the market that our sample represents, we find the market potential for EVs to be 13 to 15 percent of the annual, new light-duty vehicle market in California. Based on past annual sales of 1.4 million new, light-duty vehicles in California (a typical market during the past few years), the EV market share represents between 186,000 and 213,000 vehicles annually. This is subject to several assumptions, most importantly that, besides smaller EVs, consumers will be able to choose from midsize EVs that have driving ranges between 60 and 150 miles and that EVs will be priced comparably to gasoline vehicles. Even if the former is not true, and only sub-compact and compact body styles are available, the potential market for EVs among hybrid households will be no less than 7 percent of the new light-duty vehicle market.

We believe therefore, there is sufficient household consumer interest in EVs to satisfy the mandated 2 percent level of sales of zero emission vehicles (ZEVs) in the year 1998 as well as the 5 percent level m 2001 given current EV technologies To meet the mandated level of 10 percent of light-duty vehicle sales m the year 2003. will require either that advances in electrical storage technology allow for mid-size electric vehicles with driving ranges of 60 to 150 miles or the sale of sufficient smaller EVs to the market segments not surveyed for this study--commercial and government fleets and households that do not meet the potential hybrid household definition used in this study.

Moving the marketplace to clean and efficient vehicles is proving a complex, difficult, and long-term project. The first step, the development and commercialization of several technologies including electric, hybrid-electric, and alternative fuel vehicles is well underway. Now we must take the next step – transforming marketplace values. The challenges are formidable. There is a legacy of recent market trends. In recent years the automobile industry has focused on selling the size, power, and rugged image of truck-like vehicles; this strategy has produced some of their most profitable vehicles. Now, many consumers associate heavy, roomy, powerful, inefficient vehicle designs with images of the good life of recreation and adventure, the capacity to pick-up major home appliances at suburban superstores, or the ability to transport their child’s soccer team. These same consumers are largely ignorant that light-duty trucks – vans, sport utility vehicles, and pickup trucks – are allowed by policy to be less efficient and more polluting per vehicle mile. Ironically, there is a probably a sizable contingent of self-described environmentally conscious buyers who drive large, four-wheel drive SUVs. In our own locale, it is common to see such vehicles proudly decorated with bumper stickers exhorting people to “Keep Tahoe Blue.” (The reference is to efforts to maintain the lake’s prized clarity, a problem that appears to be connected in part to pollution from the growing populations of the Sierra Nevada foothills and Central Valley.) In such a market, how do we begin facilitate the expression of the values of efficiency, environmental stewardship, public health, and community?

The debate over electric vehicles (EVs) pivots largely on issues of market demand: will consumers purchase a vehicle that provides substantially less driving range, yet can be refueled at home, than an otherwise comparable gasoline vehicle? Also, what role do other unique attributes of EVs play in the purchase decision? Most previous studies find that limited driving range is a serious market barrier; many of those same studies ignore or under-value other novel attributes. To prove these future consumer decision processes deeply and robustly, we first devised and conducted detailed, interactive and experiment-oriented interviews. Then, incorporating what we learned, we designed an innovative mail survey and administered it to 454 multi-car households in California. The four-stage mail survey included a video of EV use and recharging and other informational material, completion of a 3-day trip diary and map of activity locations, and vehicle choice experiments. In addition to propulsion systems, respondents made choices of body styles, driving ranges, and other features. We formalized and tested what we call the hybrid household hypothesis: households who choose EVs will be purposefully diversifying their vehicle holdings to achieve the unique advantages of different propulsion systems. The hypothesis is supported, given the assumptions in our experimental design. In fact, a significantly larger number of EVs are chosen than the minimum number that would support our hypothesis. We find that purchases of battery-powered EVs by hybrid households would account for between 7 and 18% of annual light duty vehicle sales in California. EVs sold to fleets and other households would be in addition to those identified by this study.

The debate over electric vehicles (EVs) pivots largely on issues of market demand: Will consumers purchase a vehicle that provides substantially less driving range, yet can be refueled at home, than an otherwise comparable gasoline vehicle? And what role do other unique attributes of EVs play in the purchase decision? Most previous studies find that limited driving range is a serious market barrier; many of those same studies ignore or under-value other novel attributes.

To probe these future consumer decision processes deeply and robustly, we first devised and conducted detailed, interactive and experiment-oriented interviews. Then, incorporating what we learned, we designed an innovative mail survey and administered it to 454 multi-car households in California. The four-stage mail survey included a video of EV use and recharging and other informational material, completion of a 3-day trip diary and map of activity locations, and vehicle choice experiments. In addition to propulsion systems, respondents made choices of body styles, driving ranges, and other features.

We formalized and tested what we call the hybrid household hypothesis: households who choose EVs will be purposefully diversifying their vehicle holdings to achieve the unique advantages of different propulsion systems. The hypothesis is supported, given the assumptions in our – experimental design. In fact, a significantly larger number of EVs are chosen than the minimum number that would support our hypothesis. We find that purchases of battery-powered EVs by hybrid households would account for between 7 and 18% of annual light duty vehicle sales in California. EVs sold to fleets and other households would be in addition to those identifies by this study.