90% of Indian Consumers Are Willing to Pay Premium For an EV

In a recent survey by a consultancy firm EY, it has been estimated that global electric vehicle (EV) sales are expected to boom in the coming 12 months, according to the latest EY Mobility Consumer Index (MCI).

A survey of more than 9,000 respondents from 13 countries, including 1,000 respondents from India, also found that nearly 90% of consumers in India are willing to pay a premium for buying an EV and over 40% of respondents are ready to pay a premium of up to 20%. The survey was concluded in the second half of July. Among the car buyers in India, 3 in 10 respondents would prefer to buy an electric/hydrogen vehicle, the survey showed. A majority of the respondents surveyed in India consider a driving range of 100 to 200 miles from a fully charged EV, EY stated.

More than four in ten, almost 41% of those looking to buy a car in the next year say they will be buying an EV – an increase of 11 percentage points on November’s MCI – and nearly 77% of those who already own an EV say their next car purchase will also be an EV. Overall, 50% of those surveyed say they expect to buy a car (EV or combustion engine), up 17 percentage points increase from the November findings, with 65% saying that they would buy one in the next 12 months.

The survey also reveals that concern about the environment is the top reason for buying an EV, with 78% also stating that the COVID-19 pandemic has heightened awareness and concerns about environmental issues. Sixty-six percent of all consumers say they are willing to pay a premium for an EV, increasing to 91% among those who are looking to buy an EV as their next car. However, the cost of ownership emerges as the top detractor for those who do not plan to buy an EV (50%).

“EVs are expected to dominate global sales by as soon as 2033. One crucial point is that most consumers are willing to pay a premium for an EV, either due to environmental concerns or an understanding that the long-term costs will likely be lower. This is a fundamental shift in attitudes, which will ultimately be beneficial for the consumer and the planet,” says Randall Miller, EY Global Advanced Manufacturing & Mobility Leader.

While the EV market is set to accelerate, uncertainty around charging infrastructure looms, and features as a top-three concern among those not looking to buy an EV i.e. 32% of them. While 47% percent of all respondents believe there are not enough charging points available for them to comfortably invest in an EV. Prospective EV Buyers have similar concerns, with 38% stating that there are not enough charging points available. And for EV owners, charging locations (84%) and speed (78%) are cited as key concerns when it comes to charging.