Covid-19 slows EV ride as consumers prefer traditional engine: Survey

Among the six countries surveyed for the study, India is the second after US to see a sharp fall in preference for non-gasoline/diesel vehicles
The desire to buy diesel or gasoline powered vehicles is back among car buyers globally as consumers are looking for affordable, tried and tested technology in uncertain times, according to Deloitte’s Global Consumer Study 2021.

Among the six countries surveyed in the study, India is second after the US to see a sharp fall in preference for non-gasoline/diesel vehicles. 

The percentage of buyers who prefer vehicles with alternative propulsion has fallen to 32 per cent from 49 per cent a year ago, shows the study.

Interestingly, of the 32 per cent in India who said they will consider cars that offer an alternative to the traditional engine, an astounding 24 per cent chose hybrid as an option and not pure electric. This is despite the latter getting a greater policy push compared to hybrids.

Unlike most other countries that have taken a middle route in the form of hybrid vehicles, India tried leapfrogging straight to pure electric vehicles from internal combustion engine (ICE). This didn’t go down too well with the buyers who are a lot more comfortable switching first to a hybrid and then to a pure electric vehicle (EV), said Rajeev Singh, partner and automotive sector leader at Deloitte.

“An e-car is not like a two-wheeler that can be charged everywhere. It needs a proper infrastructure,” said Singh. Also, over the years, Indian consumers have evolved. Apart from the factors like range and charging infra, the driving performance has become a very important criterion for them, he added.

The Global Automotive survey was conducted from September 2020 through October 2020. The response was to the question what type of engine would you prefer in your next vehicle? The countries surveyed included the US, India, Germany, China, Japan and South Korea.

The small percentage of respondents stating EVs over ICE vehicles reflect that e-cars will continue to have a limited appeal due to a host of concerns. These include range, lack of charging infrastructure, price, safety concerns and lack of choice.  

The survey’s findings also give insights into consumer buying behaviour, and the pandemic’s influence on the choice of body type.

Along with the risk of downside demand pressure, consumers in India and China may be rethinking the type of vehicle they will acquire next, says the report.

In response to whether Covid-19 caused one to change mind regarding the type of vehicle one would most likely acquire next, close to 57 per cent respondents from India – the highest among all the countries – confirmed the pandemic has indeed influenced the decision on body type.

It was followed by 36 per cent in China, 19 per cent in South Korea, 16 per cent in the US and 14 per cent each in Germany and Japan.

The survey also offers insights into a host of other consumer buying behavior like vehicle connectivity, importance of safety,  timeline for buying the next vehicle, virtual buying and servicing of vehicles as well as subscription services, to name a few. 
For instance, 48 per cent of the respondents in India said they are willing to pay a reasonable fee to get their vehicles picked up from office or home when the vehicle needs a service. 

This percentage was the highest among all the countries surveyed. It was 46 per cent in China, 22 per cent in South Korea, 21 per cent in Japan, and 13 and 16 per cent in Germany and the US.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel