Consumer purchase intentions for electric vehicles: Is green more important than price and range?

https://doi.org/10.1016/j.trd.2017.01.001Get rights and content

Highlights

  • This study investigates consumer purchase intentions for electric vehicles.

  • Preliminary interviews with 40 end-user subjects are conducted.

  • In total, 167 test drives with a plug-in battery electric vehicle are performed.

  • A survey with test drive participants and a structural equation modeling are used.

  • Results show environmental performance surpasses price value and range confidence.

Abstract

In view of global warming and climate change, a transition from combustion to electric vehicles (EVs) can help to reduce greenhouse gas emissions and improve air quality. However, high acquisition costs and short driving ranges are considered to be main factors which impede the diffusion of EVs. Since electricity needs to be produced from renewable energy sources for EVs to be a true green alternative, the environmental performance of EVs is also presumed to be an important factor. This paper investigates the role of environmental performance compared to price value and range confidence regarding consumer purchase intentions for EVs. To develop our hypothesis, we interview 40 end-user subjects about their beliefs toward EVs. Then, we perform 167 test drives with a plug-in battery EV and conduct a survey with the participants to test the hypothesis. Results of a structural equation modeling support the hypothesis that the environmental performance of EVs is a stronger predictor of attitude and thus purchase intention than price value and range confidence.

Introduction

Increasing greenhouse gases (GHG) are considered as the major challenge for global warming, climate change, and air quality (Intergovernmental Panel on Climate Change, 2008, National Academy of Sciences, 2005). Transport accounts for 23% of worldwide carbon dioxide (CO2) emissions which are an important ingredient of GHGs and contribute to global warming, and three quarters of these are generated by road transport (International Energy Agency, 2016). In this context, electric vehicles (EVs) are considered to have the potential to reduce CO2 emissions substantially, given that electricity is produced from renewable energy sources (Asamer et al., 2016, Bickert et al., 2015, Khoo et al., 2014, Mersky et al., 2016, Zhang and Yao, 2015). From an economic perspective, compared to combustion vehicles, the main factors which impede the diffusion of EVs are high acquisition costs and limited driving range due to insufficient battery technologies (Busse et al., 2013, Pasaoglu et al., 2014, Wagner et al., 2013). Regarding McKinsey’s EV index that assesses a nation’s readiness to support an EV industry based on supply and demand, as of January 2012, the leading countries in the field of electric mobility in descending order are Japan, the United States, France, Germany, and China (Krieger et al., 2012). Among automotive manufacturers, there is a competition to lower operating costs and lower CO2 emissions. The global market for EVs is expected to grow from 137,950 vehicles in 2012 to 1.75 million in 2020 (Hurst and Gartner, 2012).

There has been increasing research in the area of EV adoption and purchase intentions (see, e.g., Bockarjova and Steg, 2014, Carley et al., 2013, Junquera et al., 2016, Mersky et al., 2016, Plötz et al., 2014, Rezvani et al., 2015, Sang and Bekhet, 2015). Previous research suggests that price and range are main predictors of EV purchase. We aim to extend this research by examining EVs’ environmental performance regarding the green contribution EVs can bring to environmental sustainability. This paper contributes to this research field by investigating the role of environmental performance compared to price value and range confidence regarding consumer purchase intentions for EVs. Two empirical studies are conducted: First, 40 end-user subjects are interviewed about their beliefs, attitudes, and purchase intentions for EVs. Second, 167 test drives are performed with a plug-in battery EV and participants of the test drives are surveyed. The collected data is used for structural equation modeling to test the influence of environmental performance, price value, and range confidence. This paper makes a theoretical contribution by conceptualizing that the environmental performance of EVs is a stronger predictor of attitude and thus purchase intention than price value and range confidence. The paper is structured as follows: First, a literature review is presented and the research gap is described. After developing our hypothesis, the research design is developed to test the hypothesis by outlining the process of data collection, data analysis, and structural equation modeling. Then, we discuss results and give limitations and implications for further research. Finally, we close with conclusions.

Section snippets

Literature review, research gap, and hypothesis development

Previous research has investigated EV consumer purchase intentions. For example, Carley et al. (2013) measure advantages and disadvantages of EVs and, besides other factors, include price, range, and the environmental aspect. Regarding the environmental aspect, they measure environmental image in a sense that “owning an electric vehicle will indicate care for the environment” (Carley et al., 2013, p. 44). In our study, we are interested in the environmental performance, meaning EVs will

Data collection

To test our hypothesis, test drives with an all-electric, lithium-ion battery powered, small passenger city car were performed from July 24, 2015 to December 19, 2015 with 167 participants (see Appendix B for test drive participant profiles). The test drives were conducted in order to allow participants experience an EV for a more accurate evaluation of their beliefs, attitudes, and intentions toward EVs. Participants were selected by offering the opportunity to take a test drive with an EV

Discussion

The empirical study supports the hypothesis that environmental performance of EVs is a stronger determinant of attitude and thus purchase intention than price value and range confidence. Since EVs are perceived as a sustainable alternative to combustion vehicles as per the results of our interviews have shown, the environmental performance of EVs is an important factor which can help the diffusion process of EVs. Our interviews also revealed that the majority of the participants place great

Conclusions

This paper investigated the role of environmental performance compared to price value and range confidence regarding consumer purchase intentions for EVs. Two empirical studies were conducted: Interviews with 40 end-user subjects and a survey with further 167 subjects who participated in test drives with a plug-in battery EV. Collected data was used for structural equation modeling to test the influence of environmental performance, price value, and range confidence on attitude and thus

Acknowledgements

The authors are grateful for the constructive comments provided by the associate editor and the three anonymous reviewers. They would like to thank Raphael Kaut for conducting the interviews, Sören Meyer for his support in arranging the test drives, and Bernadette Nüβ for supervising and executing the test drives and survey completion. They also thank Professor Jan Recker for the encouragement to write this paper. This research was funded by a grant provided by the German Federal Ministry for

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