How mapping the evolving consumer mindset is key to EV mass market appeal

Dealers and OEMs that can stimulate demand by providing the appropriate nudges at each stage of the customer journey will win EV sales.

In brief

• Based on data from the latest EY Mobility Consumer Index report, five distinct consumer segments were identified.
• The segments comprise a spectrum of attitudes and traits ranging from EV Skeptics to EV Enthusiasts.
• The two largest segments consist of those most open to becoming more EV minded — and more likely to buy an EV for their next car.

Electric vehicle (EV) demand is growing rapidly, registering 55% year-over-year growth, with record sales of 10m globally in 2022, and it is forecast to race ahead by a further 35% to reach 14m this year.

But for all the hype around the EV revolution, in many major markets across the world, EVs still only represent a modest percentage of the total number of vehicles purchased. After sustained efforts by governments and Original Equipment Manufacturers (OEMs) to boost the EV market, the fundamental question facing the industry is one of consumer behavior: “If you build more EVs, will consumers buy them?”

Using data from the latest EY Mobility Consumer Index report, EY professionals analyzed the full cohort of 14,500 participants in 20 countries to map the consumer mindset around EVs in 2023.

Respondents were allocated an index score from one to 100 for their “EV mindedness.” The scores were used to create five distinct consumer segments based on respondents’ attitudes toward EVs and sustainability, cost-consciousness, and mobility preferences. The analysis also reveals some of the wider factors associated with consumers in each of the five segments, including demographics, car and EV ownership and purchase intent, and the motivators and concerns that influence their buying behavior.

The segments comprise a spectrum of attitudes and traits ranging from EV Skeptics with a score of less than 40 to EV Enthusiasts with a score of over 95. EV Skeptics are eco-doubters, naturally conservative and risk-averse, and they seek affordability above all. EV Enthusiasts by contrast are committed to sustainability and are risk seekers, and they prioritize performance over cost.

The largest segments — the EV Persuadables and EV Considerers — lie in between these extremes. Their views are generally more nuanced — they value sustainability, for example, but they are also budget-conscious.

A snapshot of the five segments

How the segments have evolved:

• The share of EV Enthusiasts has consistently increased from 6% in 2021 to 11% in 2022 to 13% in 2023.
• This has been accompanied by some shrinkage in the Persuadables and Considerers segments, suggesting that some consumers who were in these less EV-positive segments have evolved into Enthusiasts.
• However, the proportion of Skeptics and Reluctants registered a 2% increase in 2023, highlighting that many remain unconvinced of the benefits of EVs or the compatibility of EVs with some of their wider social and environmental views.

These trends give OEMs and dealers cause for both optimism and concern. Optimism, because they suggest a natural tendency for Persuadables and Considerers to become more EV minded over time, developing into Enthusiasts. If that tendency can be harnessed, more consumers will develop an EV-positive mindset more quickly. The results also cause concern, however, simultaneously suggesting there is a core group of conservative and risk-averse consumers — the EV Skeptics and Reluctants — whose attitudes toward EVs are tied into their wider views of society and are thus likely to prove harder to shift. 

Digging deeper: segment differentiators

The doubters — Skeptics and Reluctants

Eco-consciousness and an EV mindset remain strongly correlated. The least EV-positive segments — Skeptics and Reluctants — are either unconvinced about the threat of climate change or inclined to think it is overblown. Only 28% of EV Skeptics who intend to buy a car rate environmental concerns as their number one motivation for buying an EV, and only 12% say sustainability is a factor that influences their choice of a mode of transport.

Respondents in these segments are also older — 43% of Skeptics and 37% of Reluctants are boomers — and have a stronger attachment to the internal combustion engine (ICE) vehicles they grew up owning and driving. They are budget-conscious (only 12% of Skeptics are in the high-income group) and see up-front costs as the key disincentive for buying an EV. They are the least prepared to pay extra for owning an EV – 49% of Skeptics and 34% of Reluctants are unwilling to pay any premium.

Range is a major worry, reflecting both an innate preference for what they are used to and a lack of real-world experience of EV use (range concerns tend to diminish once consumers have owned or used an EV). Forty-four percent of Skeptics prefer an extreme 400-mile (640-km) range from an EV, a mark few models reach and one largely incompatible with Skeptics’ cost-driven preference for budget and mid-market models.

Skeptics and Reluctants don’t associate EV ownership with affordability, and they put affordability first. As a result, they are the least likely to already own an EV, at only 6%.

These two segments are conservative and risk-averse, making them the hardest to reach when it comes to OEMs and dealers looking to promote greater EV mindedness. But they are by no means a lost cause — they are cost-conscious but also ill-informed about EVs, so they could be swayed by better information on the lower total cost of ownership of EVs, provided they are convinced of the impartiality of the data.

The converted — Enthusiasts

At the other end of the scale, EV Enthusiasts are fully paid-up eco-consumers who actively promote environmental commitment: 50% who say they intend to buy a car rate environmental concerns as their number one reason for choosing an EV, and 79% say sustainability is a factor that influences their choice of a mode of transport.

They are the least cost-conscious consumers (21% of Enthusiasts are in the high-income group, the largest proportion of any segment) and the most inclined to choose a premium-model EV. They are also able and willing to pay more for an EV than an ICE car, with no fewer than 40% of enthusiasts prepared to pay a premium of 20% for an EV.

They are well educated — 63% of Enthusiasts have at least an undergraduate university degree — and well informed when it comes to EVs. They are the EV evangelists, but they are still a significant target market as only a relatively modest 22% already own an EV.

Enthusiasts are happy with a relatively low vehicle range of 200 miles to 300 miles (320 km to 480 km) but could become even more pro-EV if their concerns about the low charging speed and lack of availability of charging infrastructure were addressed.

The fertile middle ground — Persuadables and Considerers

In between there are the floating voters, the Persuadables and Considerers. Persuadables are open-minded and willing to be talked into buying an EV while Considerers are actively weighing the pros and cons and researching their options. 

Persuadables and Considerers also comprise the largest segments, accounting for 57% of the market between them — and are roughly equal in size at 28% and 29%, respectively.

Consumers in both these segments value the environment: Environmental concerns are at top of the list of reasons for Considerers to go electric (37%), while for Persuadables, the environment is second on the list at 28%. 

Thirty-three percent of “eco-conscious” Persuadables and 58% of “eco-centric” Considerers also say sustainability is an influence when choosing a mode of transport. And 56% of Considerers say environmental issues are a concern for them and their families.

General attitudes

The demographic divide

The demographic profile of our segments confirms the received wisdom that younger consumers tend to be more EV minded. The proportion of boomers falls as we move from Skeptics to Enthusiasts, while the proportion of millennials — a key buying group for OEMs and dealers — peaks at 37% in the Considerers and 36% in Enthusiasts. Skeptics are also the most likely to be retired while over 50% of both Considerers and Enthusiasts are employed full time. The proportion of Gen Zs is uniformly low, peaking at 10% in Persuadables.

Skeptics and Reluctants are more likely to live in rural areas and small towns, while Persuadables, Considerers and Enthusiasts tend to be found in city centers. All segments have a significant number of commuters traveling over 12.5 miles (20 km) a day, suggesting that attitudes toward EVs are not substantially influenced by the length of regular journeys taken.

The use of public and shared transport is, however, much more prevalent in more EV-positive segments — 70% of Enthusiasts and 68% of Considerers use multimodal travel for work or study, compared with only 32% of Skeptics and 48% of Reluctants.

Buying intentions

Although car ownership across all five segments is high — well over 70% — buying intentions vary considerably. Skeptics and Reluctants are the least likely to buy, with 53% and 47%, respectively, not planning to buy any car at present. And when they do buy, the majority of both of these segments intend to buy an ICE vehicle. By comparison, 40% of Persuadables and 54% of Considerers do intend to buy a car, with 51% and 64% of those, respectively, intending to buy an EV.

Despite being the preferred body style by over 40% of buyers across all segments, SUVs are not the only choice for EV-positive consumers. Around a third of Persuadables and Considerers prefer a sedan, compared with only 21% of Skeptics, and hatchbacks are popular with Reluctants and Persuadables in particular.

Car-buying story

Conclusions — “no regret” moves to create more EV-minded consumers

The message for OEMs and dealers looking to encourage more buyers into an EV is clear: The middle ground is likely to prove the most fertile. The segments that are most open to becoming more EV minded — and more likely to buy an EV for their next car — are the Persuadables and the Considerers, the two largest groups.

But while our data shows these consumers represent the easiest wins when it comes to “trading up” a segment, it is also important that attempts to woo buyers do not focus only on the middle ground at the expense of the extremes. EV Reluctants and Skeptics may be more cost-focused, more reluctant to pay a premium for an EV and have more entrenched views about the environment and climate change, but in the longer term, they still represent a substantial potential market. Likewise, at the other end of the spectrum, many EV Enthusiasts may already have made the jump, but they have a valuable role to play as evangelists and customer advocates.

There are three key areas in which “no regret” moves can be made to encourage consumers across the board to trade up to a more EV-positive mindset.

1. Awareness

Low awareness of the day-to-day practicality of EVs – in the shape of concerns over usability, reliability and comfort – hold back many consumers, particularly those whose awareness or experience of current improvements in vehicle performance and infrastructure is limited or out of date: Skeptics and Reluctants.

Worries about inadequate battery performance and range are also a key negative influence for Considerers in particular.

Raising awareness by providing clear, accurate and impartial information about life with an EV, and how battery performance can be optimized through good driving and charging practices, should help these consumers to understand that they would be more satisfied with the performance of the latest EV models than they realize.

2. Access

The view that access to EVs is limited to those who are happy to shoulder a greater cost burden is a key influence on Skeptics, Reluctants and Persuadables in particular. Perceptions of high up-front purchase costs and potentially large ongoing liabilities such as battery replacement make an EV look like a high-risk choice these budget-conscious consumers can’t afford to make.

OEMs and dealers can help address these concerns by offering alternative ownership models and “smart financing,” such as rental and lease to own, to provide greater certainty over the cost, affordability and low financial risk of joining the EV club. Many OEMs are also exploring offering subscriptions on EVs and even the batteries, aimed at encouraging the EV-curious to test the ownership experience with minimal financial commitment.

OEMs can further alleviate cost-of-access concerns by providing a wider choice of mid-market and budget EVs with “good enough” rather than market-leading performance.

3. Expectations

All five segments are — to a greater or lesser extent — uncertain as to what to expect from life with an EV. Even consumers who are already among the more EV minded have lingering concerns over charging performance, range and cost. OEMs and dealers can help manage these expectations by providing transparent, realistic and granular information on the performance of all their models. What kind of ranges and charging times can owners realistically expect to achieve, and under what conditions?

The use of digital tools to help estimate range and to plan longer trips can also help establish clearer expectations and manage range anxiety, while consistent communications around the lower total cost of ownership of EVs in the long term can help alleviate cost worries among Persuadables and Reluctants in particular.

The EV sales victory will go to those who can stimulate demand by providing the appropriate nudges at each stage of the customer journey and encourage consumers to trade up a segment — so that an EV Reluctant becomes an EV Persuadable, an EV Persuadable becomes an EV Considerer and an EV Considerer becomes an EV Enthusiast.