Why electrifying the light truck market could be tough
New research suggests a problem for policymakers hoping to rapidly move U.S. road transport from gasoline to electricity: drivers of huge-selling pickups and SUVs may be a tough sell.
Driving the news: The working paper explores how electric vehicle adoption is correlated with different forces, such as purchase subsidies, battery range, and "intrinsic" factors like belief in climate change.
The big picture: Thus far, adoption has been higher in coastal areas where sedans are relatively more popular than interior states with higher penetration of light trucks.
- Part of that is because electric sedans were first to market. But as automakers start delivering electric pickups, EV adoption is highly uncertain even with significant incentives, per researchers with the Universities of California and Maryland.
- That's because the pro-adoption effect of purchase subsidies and battery improvements may run into powerful headwinds among light truck drivers.
- They include lower belief in climate change and buyer demographics that are more "EV-friendly" on the coasts for reasons like higher population density that shortens trips.
- Also, in rural areas, use cases more often demand larger vehicles, notes co-author David Rapson, who summarized the findings on Twitter.
Why it matters: Transportation is the largest source of U.S. greenhouse gas emissions. Light trucks — including pickups, SUVs and minivans — represent over half of U.S. vehicle sales.
- The White House is asking Congress to approve major new EV purchase incentives and charging infrastructure development.
Zoom in: The paper models a wide range of EV growth scenarios and doesn't land on a most likely estimate. But all find that subsidies would need to be very significant to have a big effect on adoption.
- That's because other forces more powerfully influence buyer decisions, such as "cultural" considerations and charging availability.
- For instance, under a "medium" level of "intrinsic" growth, a cumulative $3.6 trillion in subsidies is needed to achieve a 50% EV share of new car sales in 2035.
- Under their "high" intrinsic growth case, subsidies would be roughly $480 billion.
Yes, but: The paper — which is based on survey data, observed sales to date and demographic information — released via the National Bureau of Economic Research was not peer-reviewed.
- And modeling of the future vehicle mix is stuffed with uncertainties the authors acknowledge — including a range of estimates for how demand will be linked to subsidies and price.
What we're watching: Automakers are bringing new electric pickups and SUVs to market, including an electric version of Ford's massively popular F-150 pickup.
- But the paper notes that if environmental views continue playing a significant role in purchase decisions, "adoption might continue to lag in many parts of the country even after robust EV alternatives are created for market segments outside of sedans."
Go deeper: Ford says it will invest $30 billion in electric vehicles by 2025