University of Michigan study: Electric vehicles' cost is main factor for consumers
Price trumps environmental factors in consumers' consideration of whether to purchase an electric vehicle, according to a University of Michigan study released this morning at a high-profile auto conference in Detroit.
Some 46 percent of consumers said they'd consider paying a $2,500 premium for a plug-in hybrid electric vehicle. But only 30 percent said they'd consider a $5,000 premium, and just 14 percent said they'd weigh a $10,000 up-charge.
"There’s widespread interest in plug-ins as well as widespread resistance to the expected cost of plug-ins," said Richard Curtin, director of Reuters/U-M Surveys of Consumers, led by the U-M Institute for Social Research.
The national survey, released today at "The Business of Plugging In," a conference organized by the Ann Arbor-based Center for Automotive Research, studied a representative sample of 2,513 adults between July 2008 and November 2008.
The survey is another reminder to major automakers that they must continue to drive down the cost of lithium-ion battery technology, which is critical to ensuring affordability of electric vehicles. The industry's first mass-marketed semi-electric vehicle, General Motors' Chevrolet Volt, to be released in November 2010, is likely to cost close to $40,000.
The study also underscores the importance of the federal government's promised $7,500 tax credit in spurring the sales of electric vehicles.
The good news for automakers is that consumers appear willing to consider alternatives to internal combustion engines.
"I expect that we’ll see a significant niche for electric cars," Curtin said at the conference. "How fast and how big a niche, we cannot know for certain at this point. But we can say with a great deal of certainty that consumers are ready to experiment with alternative technologies in transportation."