Texas-based research company Zpryme released a new report today (pdf link) predicting that oil instability in Libya and the Middle East, contrasted with the less-volatile electricity prices and federal initiatives, may drive consumers towards electric and plug-in hybrid vehicles to replace their current vehicles over the coming years.
“Retail gasoline prices are up $1 per gallon since last year and 90 cents per gallon since January,” reads the report. “High gas prices are forcing consumers to make fuel economy a top priority for their next car purchase.
“Electricity prices, however, are more stable,” Zpryme continues. “Eliminating gasoline as a fuel source and switching to an all-electric vehicle will result in considerable and consistent savings.”
The transition will be both drawn-out and difficult, the company said. Despite President Obama’s $7,500 tax rebate for those who purchase electric vehicles, the company predicts there will only be about 730,700 EVs and PEHVs on the road by 2016 – shy of Obama’s goal of 1 million. Certain incentives may be able to raise the number of zero-emissions vehicle sales, though, such as switching the $7,500 federal tax rebate into a point-of-sale rebate. But more importantly, people seem concerned about the lack of charging infrastructure.
“Potential buyers are concerned about the lack of fueling stations available on the road and the limited battery range of current model PEVs,” says Zpryme. “Further, they have expressed ‘sticker shock’ at the additional $10,000 needed to purchase an electric vehicle. However, if these roadblocks were removed, would rising gasoline prices sway consumer preference for all-electric vehicles?”
With time, the odds look pretty good.
“The rise of the EV will impact investments of automakers, battery manufacturers, charging service providers, electricity retailers, power generators, and network operators as well as the infrastructure they build. Simply put, there is a wide array of stakeholders in the electric vehicle arena. Coordinating all of these parts and developing the electric car future is no easy task. Although the long-term vision of a predominantly electric vehicle fleet appears to be feasible, in the short term EVs will share the market with conventional gas powered cars. With time, as gas prices and inflation continue to rise and EV technology progresses, consumer preference will more fervently shift to the electric vehicle.
“And major automobile manufacturers will be ready.”
By 2016, automakers are expected to have up to 30 different all-electric vehicles on the market, as well as 25 to 30 hybrids and plug-in hybrids to choose from.