The Electric Vehicle (EV) market has grown over the past few years, continues to boom, and is expected to keep doing so in the coming years. Unfortunately, EV sales have never been significant enough to turn heads. So when it's time for buyers to purchase a new vehicle, have been reluctant to jump at buying an EV when it was time to purchase a new vehicle; not anymore.
As of March 2017, EV sales across Canada have been growing year-over-year with a 68% increase in vehicles sold from the same period in 2016. British Columbia is leading the way with 4% of total sales being EVs. If the 2017 trends keep course, the market across Canada will see similar growth; EVs sales in Quebec and British Columbia to account for 5% of the total market in 2017. That is a marked increase from 0.4% a couple years ago.
As regulation and international market demand is quickly shifting towards EVs, car manufacturers must adapt. Last week Volvo made the commitment to only build PlugIn Hybrid Electric Vehicle (PHEV) and battery electric vehicle (BEV) by 2019 moving away from the combustion engine. Companies like Audi, BMW, Ford, Mercedes and many others are moving towards the increasing EV market while meeting existing and upcoming national regulations:
- Germany: Passed a resolution to ban internal combustion engines (ICE) by 2030.
- India: Its Power Minister confirmed that India is planning on being a 100% EV country within 14 years
- Netherlands: Voted to ban all sales of new ICEs vehicles by 2025.
- Norway: Planning on selling only zero emission cars by 2025. However ICEs already on the road will remain legal.
- China: Planning on banning ICE within most major cities boundaries.
As the market shifts, manufacturers will have to adapt to the demand whether it’s from a cost benefit analysis for the organization’s fleet or gaining / retaining customers by providing EV charging stations. As a 2016 Bloomberg study shows, the electric car will form a “S” curve similar to other disruptive products in the past such as the refrigerator, television, computer and smartphone. When the product begins to be accepted by the general public, sales takes off exponentially. The concept of the “S” curve relative to the EV market is well explained in this short video.
As demand is ramping up, it will be vital for organizations in the retail, hospitality, tourism, and industries alike to offer EV charging stations to their clients. For those who remember the early 2000s when Wi-Fi became popular, hotel chains and coffee shops who invested first in the technology are the one who have benefited the most. This scenario is now repeating itself with charging stations; the early adapters will recoup the costs faster as competition will have to conform over time. Companies and organizations who desire to push their sustainability policies and engagement further will have the opportunity to provide the same EV station service to their employees during working hours. Other enticements will include the introduction of electric vehicles into car fleets as a way to reduce expenses. Fleetcarma and PlugIn BC have tools for car fleets assessment that will be discussed in a later post.
Electric Vehicles and Municipalities
The next inflection point in the market will be the adoption and expansion of the infrastructure network by local municipalities and provincial and territorial governments. As of 2017, governments continue to wrestle with the charging infrastructure network question. EV sales in 2016 and 2017 have increased by over 65% as charging infrastructure has a hard time keeping up with the demand. Now, most EV owners’ dilemma is not about range anxiety, but infrastructure anxiety - “where can we charge?” “How long do we have to wait in line?” As an EV owner myself, speaking with other EV owners, these questions are a common occurrence. Avoiding this reality is key to the success of the electrification of transportations. As it has been show with different products, adoption takes the path of least resistance, therefore it is important for the electronic vehicle to have existing road blocks such as expanding the required infrastructure be solved so that buyers can switch from gasoline cars.
Today, statistics show that 80% to 90% of the charging is being done at home. This is mostly because early adopters have the luxury of having a residence allowing them to charge their car overnight. However, 70% of the population lives in cities where street parking is the predominant alternative. There are no pilot projects yet, but it would not be surprising to see public charging stations installed within pre-determined street blocks for cost efficiency. We would then see an entire street reserved for EV parking. Therefore, municipalities will be playing an important role in the implementation of EV charging stations for its urban citizens in this context.
Is Your Organization Ready to Embrace the Rise of the Electric Car?
While many countries are changing car regulations to meet international targets, car manufacturers improving EV technology, customers increasing adoption rate and the undeniable fact that the world needs to phase out oil, there is a business opportunity for businesses to grasp. Whether it is to provide EV charging station as additional service for clients, improving employee engagement, or by assessing your organization’s car fleet making a shift toward electric cars, there is always a short and long-term benefit from taking the next step. For those of you who have an annual corporate social responsibility (CSR) report or looking to get a sustainability certification, moving forward, this type of initiative will surely facilitate the process.
Written By Maxime Charron, Founder at LeadingAhead