Stewart Stropp: EV Consideration Study from J.D. Power Illustrates Need for More Information & Transparency to Increase Adoption
By Melissa Fisher, Executive Editor of BizTechReports
Now that we’re well into 2022, electric vehicles (EVs) are gaining tangible traction in the auto market. Ongoing product launches, infrastructure build-out, policy change and rising gas prices are greasing the ramp-up in consumer interest.
But significant work lies ahead if the industry wants to accelerate the transition from early to mass adoption of EVs. A lack of information on the value and ownership propositions has left a large swath of new-vehicle shoppers reticent to make the electric leap.
Automakers, retailers and other stakeholders need to ‘rewrite the script’ to change consumer attitudes and increase interest in EVs, says Stewart Stropp, managing director of J.D. Power’s Electric Vehicle Consideration (EVC) StudySM. To learn why and how, we sat down with Stropp to discuss key elements driving – and preventing – EV adoption. Here’s what he had to say:
Q: As acceptance of EVs transcends the early adopter stage, how well-attuned is the automotive industry to the novel requirements of the growing—but still nascent—EV customer base?
Stewart Stropp: There are important knowledge gaps on both the demand and supply sides of the equation. In these early days of the EV marketplace, we’re seeing a lack of acumen and confidence not just among new-vehicle shoppers, but on the seller side too, the latter being evident in the EV Sales Satisfaction Index (SSI) and Customer Service Index (CSI) Studies from J.D. Power. Both gaps need to be bridged if mass EV adoption is going to happen.
In 2021 J.D. Power launched a suite of VOC (voice-of-customer) studies to better understand the numerous factors influencing the EV shopper and owner experience. One of the studies, the EV Consideration Study (EVC), focuses on how consumers approach the prospect of buying and owning an EV before they make purchase decisions. Our goal with the study is to explore what prompts people to move forward with an EV purchase or, just as importantly, resist -- or outright reject -- the idea.
We learned a lot from ’21 EVC. The pace of insights won’t be slowing down in the 2022 study, which comes out in May. Even so, I wouldn’t be surprised to see one of the usual suspects for EV reticence continue to be a perceived lack of charging station availability, followed by fears about driving distance per charge (i.e., range anxiety).
To explore the legitimacy of these very understandable concerns, I put my own EV and the national charging infrastructure to the test on a recent cross-country road trip from San Diego to Nashville.
Let me say from the start, there was no point on the journey when I found myself in danger of being stranded without power. Not only was I able to track and plan my route around chargers pretty easily, I was also able to use them without much trouble. I never even had to wait for a charger at a station. A few of them were crowded, but never totally occupied. In fact, on several occasions, I was the only vehicle at the station. This is particularly important considering I made the drive over a major national holiday when road traffic is unusually high.
There’s no question the number of charging stations, particularly those with direct current fast charging (DCFC) capabilities, is a mere fraction of the number of gas stations. But based on my experience, the existing charging network is actually pretty well right-sized to the EV car park right now. The good news is that the infrastructure continues to grow, which it definitely needs to do to help facilitate the transition from early to mass adoption.
Another more nuanced concern I hear about the infrastructure is inoperable or malfunctioning chargers. People are worried about pulling up to a station and finding a lot of the chargers broken or out of service. I have to say, of the roughly 200 chargers I used or saw at the stations on my route, three were inoperable.
Now, that’s not to say everything was perfect. EV charge time, even on a DCFC, is multiple times longer than filling up a conventional internal combustion engine (ICE) vehicle at a gas station. And there were a few harrowing moments driving up mountain passes and watching my range number evaporate on screen. Of course, once I crested the peak, I felt a huge sense of relief as the regen braking kicked in and started adding range back.
But it still left me wondering: Does the range calculator account for the altitude change?
While searching the internet from my hotel room that night, it was difficult to find a conclusive answer. So I think there’s an opportunity to improve the volume and transparency of EV educational content not just for shoppers and sellers, but also for new owners.
Q: From a communication standpoint, do you feel the average customer has the right information to make a fully informed decision between EVs and ICE vehicles?
Stropp: The short answer is no. Based on what we see in the data, the real key to getting meaningful engagement with consumers -- and the most productive, actionable and immediate opportunity to accelerate EV adoption -- is to give shoppers more information and experiential opportunities.
Consumer education, across various communication channels, is key to addressing a whole array of basic shopper concerns. The EVC study shows that one-in-three EV rejecters say a general lack of information is a primary reason for their negative disposition toward owning electric vehicles.
There is a particular lack of understanding about the financial aspects of owning an EV. Retailers need to rewrite the script and shift consumers’ attention away from an exclusive focus on sticker price. They should guide prospective buyers toward a broader -- and more accurate -- assessment of the total cost of ownership associated with EVs.
While it’s certainly true EVs sell at a higher price than comparable ICE vehicles, after the point of sale, the financial benefits of EVs start accruing pretty quickly in terms of fuel and maintenance savings. There is also a need to help consumers make sense of how federal tax credits and other incentives enhance the economic attraction of EVs. Many utility providers, for instance, offer discounts to EV owners who leverage recommended low-cost charging times. A lot of shoppers don’t know that.
A solid understanding of the economics around EV should be part of the consideration calculus presented to shoppers. J.D. Power data, however, indicates this critical discussion is not getting the attention it should with shoppers.
Without a practical understanding of these variables, customers end up missing out on the potential benefits of going electric. So the industry has a massive opportunity to fill the void of shopper EV knowledge out there. Buyers, after all, can only work with what they know.
Q: How can automakers reposition the EV conversation?
Stropp: Here is the good news. For the most part, once a consumer goes electric, they don’t go back. That’s why it’s so important for the industry to understand the current state of the “consideration mindset.” This will influence how automakers and retailers put EVs into contexts that are meaningful to the specific circumstances of prospective buyers who possess little to no firsthand knowledge of -- or interaction with -- electric vehicles.
Shoppers need to know, in terms of regular charging, that 84% of it is done at home. They also need to have more opportunities to experience the performance dynamics of EVs for themselves…especially the instant acceleration. This information should be put forward aggressively to shoppers. Effective informational and experiential campaigns can embolden the interested -- and change the minds of the uninterested.
For more information or to schedule a podcast interview, please contact Melissa at mfisher@biztechreports.com.