Increasing the competitiveness of e-vehicles in Europe

Abstract

This paper is concerned with incentives for the take-up and use of e-vehicles that are in place in different European countries. Especially, it analyses Norway and Austria, in order to establish and understand factors influencing the competitiveness of e-vehicles and potential market penetration. Norway currently enjoys the world’s largest take-up of electric cars per capita, achieved through an extensive package of incentives. Austria has used the concept of Model Regions with government support to stimulate market introduction. So far, this has been a less effective approach. The paper brings in and combine analyses of national travel survey data and web surveys to e-vehicle owners and non-e-vehicle owners. It considers socio-economic factors including convenience and time savings due to e-vehicle policies. Analysing national travel surveys, we find a considerable potential for e-vehicles based on people’s everyday travel. Social networks play a crucial role in spreading knowledge about this relatively new technology. The take-up of battery electric vehicles correlates relatively closely with the user value of e-vehicle incentives. The fiscal effects of e-vehicle incentives are non-trivial – especially in the longer run. The cost of lifting a new technology into the market by means of government incentives is significant. We point to the importance of a strategy for the gradual phasing out of e-vehicle policies in countries with large incentives when the cost of vehicles goes down and the technology improves. Successful market uptake and expansion of electric vehicles requires massive, expensive and combined policies. Central government backing, long term commitment and market-oriented incentives help reduce the perceived risk for market players like car importers and allow the e-vehicle market to thrive. For countries with low e-vehicle market shares the potential is promising. Battery electric vehicles are already a real option for the majority of peoples’ everyday trips and trip chains. However, their relative disadvantages must be compensated by means of incentives – at least in the initial market launch phase. Diffusion mechanisms play a sizeable role. The lack of knowledge in the population at large must be addressed.