 Persuading consumers. Chapter 12 in The Global Rise of the Modern Plug-In Electric Vehicle, 2021, pp 397-436 from Edward Elgar Publishing Abstract: The record shows that it takes at least a decade of sustained, pro-PEV policies to kick-start the mass commercialization of PEVs. The primary reasons that Norway and China are commercializing PEVs faster than other countries relate to government policies. Both countries mustered the political will to penalize buyers of conventional powertrains, though the penalties came in different ways. Norway used tax policies to make a PEV significantly cheaper to purchase than a comparable gasoline vehicle. The PEV’s price advantage, coupled with lower operating costs, favorable urban traffic incentives, and subsidies for public charging, worked to achieve mass commercialization, albeit at large cost to the government. Even in this highly favorable policy environment, more than 40% of Norwegian consumers choose against PEVs, which underscores the pressing need for PEVs with longer driving range and shorter charging times. China focused on price reduction through vehicle subsidies but equally crucial was the de facto prohibition on the use of cars in large eastern Chinese cities unless they are PEVs. China’s PEV market share (roughly 5% in 2019) is much larger than the US, Japan, and Europe but far behind Norway. As China phases out subsidies and eases licensing restrictions in large eastern cities, the rate of growth in the PEV share may slow unless China’s new ZEV mandate forces growing PEV shares from 2020 to 2025. If China tries to force production of PEVs without receptive consumers, the country runs the risk of repeating the problems that California experienced in the 1990s. Measured by PEV market share, California (7.2%) is far behind Norway but ahead of China. California’s combination of a ZEV mandate, HOV lane access for PEV owners, consumer rebates, and a growing public charging network, has induced much more commercialization than any other US state. California is a relatively wealthy state but needs to address the hard question of when PEV subsidies should end, which would allow HEVs, PHEVs and PEVs to compete in the marketplace without policy bias. California’s CO2 standard already accounts for how much different technologies reduce CO2, except for upstream emissions from PEVs and manufacturing emissions. Even if California should lose the federal preemption argument, it could readily pivot and promote PEVs through a French-style feebate system. National progress on PEV policies and deployment trails California’s progress because the PEV issue polarizes on party lines in Congress. Europe is moving much faster to adopt PEVs than Japan as measured by PEV market share. Japan has decent incentives and infrastructure in place but Japanese automakers are offering few PEVs. Europe has increasing purchase incentives and uneven infrastructure but PEV offerings are growing rapidly and PEV sales are increasing explosively from a small base. The EU’s CO2 standards are a bigger factor than Japan’s fuel-economy standards in pushing commercialization of PEVs. The EU is beginning to make major investments in charging infrastructure for PEVs. Keywords: Business and Management; Economics and Finance; Environment; Geography; Innovations and Technology; Law - Academic; Politics and Public Policy Urban and Regional Studies (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:elg:eechap:20411_12 Ordering information: This item can be ordered from Access Statistics for this chapter More chapters in Chapters from Edward Elgar Publishing |
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