Demand for electric vehicles (EVs) has slowed in the United States, but New York-based consulting firm AlixPartners projects continued expansion over the long term.
According to a survey of 9,000 people in eight countries representing over 80% of worldwide EV sales, 35% of respondents in the US are very or moderately likely to buy an EV. This figure is expected to rise to 40% in 2030 and 48% by 2035.
Despite this positive outlook, consumer concerns about vehicle range and availability of charging stations remain a challenge. “It’s all about charging, charging, charging,” said Arun Kumar, partner and managing director in the automotive and industrial practice at AlixPartners. “Charging seems to be a brick wall consumers are hitting.”
In the short term, U.S. consumers are considering plug-in hybrid electric vehicles (PHEVs) as a substitute for fully electric vehicles. PHEVs use batteries to power an electric motor while also having an internal combustion engine, providing increased range and the ability to operate when charging is not available.
In contrast to the US, China is experiencing rapid EV adoption. The survey found that 97% of respondents in China intend to purchase an EV for their next vehicle. Chinese automakers are also building awareness for their EVs in other regions, with BYD emerging as the top Chinese brand in terms of awareness in mature markets like the US, Germany, and Japan.
To remain competitive, traditional automakers may consider expanding their PHEV models and converting existing models to PHEVs to conserve capital. Additionally, they need to reduce costs in their internal combustion engine operations to free up money for investments in EVs and PHEVs.
