Introduction
The automotive industry is undergoing its largest transformation since the replacement of horse-drawn wagons with cars. Electric vehicles (EVs) are gaining market share, with connected cars and autonomous vehicles increasingly appearing on streets worldwide. However, the transition to new technologies has faced challenges, particularly in the EV sector. After years of rapid growth, EV sales have slowed in many regions.
Regional Differences in EV Adoption
EV uptake varies significantly by region. In 2024, about 50% of vehicles sold in China were EVs (28% battery electric, 15% plug-in hybrid, 6% extended-range). In contrast, EVs accounted for 21% of European sales (14% battery electric, 7% plug-in hybrid) and 10% in the United States (8% battery electric, 2% plug-in hybrid). Purchase intent for EVs is highest among those with prior EV experience.
Consumer Concerns and Expectations
Globally, consumers share similar concerns about EVs, primarily related to range, price, and charging infrastructure. The average minimum real driving range that would convince consumers to switch to an EV is about 500 kilometers (310 miles), up from 425 kilometers (264 miles) in 2022. Most current EV owners plan to purchase another EV, with under 10% intending to revert to internal combustion engine vehicles.
Purchase Criteria and Brand Loyalty
EV purchase criteria differ across regions. Battery range is the most important factor globally, followed by price and charging speed. Chinese EV buyers prioritize driving performance and advanced technology, while European and American consumers focus on price, safety, and performance. EV owners show less brand loyalty than ICE buyers, with the highest switching rate observed in China.
OEM Strategies for EV Success
To appeal to EV buyers, OEMs should understand regional customer preferences and adapt their offerings accordingly. Strategies include improving the customer journey through omnichannel experiences, reducing costs, and developing strong portfolio strategies. The introduction of extended-range electric vehicles (EREVs) could help attract more consumers to electric driving.
Future of Electric Vehicles
The global transition to EVs varies considerably across regions. While China is moving towards an electrified future, the transition is more uncertain in other markets. OEMs must address consumer concerns through education, technology advances, or portfolio adjustments. Chinese OEMs entering new markets need to establish their brand and reputation, while Western companies must develop superior EV technologies to compete.
