EV loyalty climbs to 55%

It feels like electric vehicles are dominating the industry now
– everyone is talking about them, the manufacturers are rushing to
design and engineer them, battery plants are springing up
everywhere, and so on. Given such widespread attention to this
powertrain, it would make sense to take a look at how current EV
owners feel about their cars or light trucks. Fortunately, IHS
Markit’s census registration data and supplemental sales and
powertrain data provide a good look into the behavior of electric
vehicle owners, including their re-purchase patterns.

EV owners’ loyalty to the electric vehicle propulsion system*,
regardless of brand, size, or price, has steadily been increasing
over the last five years. From a fuel type loyalty of 34% five
years ago, EV loyalty has climbed to 55% in 2020, according to IHS
Markit loyalty data. Also, given the prominent position of Tesla in
the EV space, it is understandable to assume Tesla plays a central
role in these improving EV loyalty results, but that’s not the
case. It turns out that non-Tesla EV owners are almost as loyal to
the EV concept as Tesla owners, with loyalty of 52% in 2020, up
from 31% five years ago.

A second, related metric supports the trend mentioned above,
i.e., an increasing openness to the electric vehicle concept. IHS
Markit registration data indicate that owners of all four major
fuel types, including gasoline, hybrid, diesel, and EV, are moving
at an increasing rate to electric vehicles. Although the numbers
are small for gasoline, hybrid, and diesel households moving to an
EV, the results are up for all three fuel types when compared to
five years ago. Hybrid movement to electric vehicles has quadrupled
since 2015 (when measured as a percent of total hybrid return to
market volume), diesel movement to EVs has more than doubled, and
gasoline switching to EV has quintupled (admittedly up from a small
base).

EV market share reached just 1.8% of the U.S. new light vehicle
market in 2020, a far cry from what many OEMs are expecting in the
future given their enormous R&D expenditures. But several
metrics, including EV loyalty and movement from other fuel types to
electric vehicles, are moving in the right direction.

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*Fuel type loyalty is defined as: of the households with a
certain fuel type vehicle in the garage that return to the market
in a defined time frame, what percent acquire a vehicle with the
same fuel type, regardless of brand, price, size, or any other
attribute of the newly acquired vehicle.

Posted 22 March 2021 by Tom Libby, Associate Director Loyalty Solutions and Industry Analysis, Automotive

Source: http://ihsmarkit.com/research-analysis/ev-loyalty-climbs-to-55-percent.html