COVID-19 is a catalyst for electric vehicle growth | KHWS

COVID-19 is a catalyst for
electric vehicle growth

Retail

When the world came to a lockdown standstill, a change was bubbling away under the surface. Consumer behaviour adapted quickly to the new restrictions in place; online ordering increased while other industries, such as transportation, ground to halt. Now with lockdowns easing, consumers are looking towards a future that has been fundamentally shifted by the pandemic.

One industry that has experienced a positive boost is the electric vehicle (EV) market. Car sales in the UK dipped by 94% during the COVID lockdown, whereas electric vehicles saw an increase of 4.6%. The highest selling vehicle in the UK during April 2020 (mid lockdown) was the Tesla Model 3; accounting for 15% of UK car sales. Clearly the slow rise of EVs has shifted into a higher gear, with COVID acting as a catalyst for new growth.

This EV growth has been pushed from many sides.

EV OEMs are working hard to address consumer concerns -primarily limited EV range, battery charging speed and safety concerns – although costs, battery replacement and resale values are still yet to be overcome.

Global leaders are also helping to remove barriers. Recently the UK government has put in place multiple tax breaks and other benefits for electric vehicle buyers. Going forward we are likely to see further benefits to owning an EV, making the change even more enticing for these consumers.

Governments may also see the current global pandemic as an opportunity to reinvigorate the economy with a ‘green’ plan. 44% of UK car buyers say the reduced air pollution caused by lockdown has made them consider an EV,  meaning there is shared interest for consumers, EV manufacturers and the government.

The overriding behaviour change that is driving EV Sales is the Sales Trigger™ that we call the Obvious Truth – reinforce perceived ideas of a brand’s values as people seek information that reflects their beliefs.

This Trigger resonates with a growing movement of aspirational shoppers (source Globescan/BBMG) that are seeking brands that deliver beyond their functional benefits – they seek brands with strong ethical values and a commitment to make a positive difference to society. This movement is impacting the decision making of over 40% of UK consumers and combined with the importance of sustainability -given fresh impetus by COVID – is the driver for this behavioural change.

Opportunity

The global pandemic is shaping and creating new behaviours as consumers adapt to a new normal. The brands who will come out on top during these challenging times are the ones who identify the buying behaviours of their audiences and create marketing and messaging that reflects these behavioural insights.

Electric vehicles are growing in market share quicker than expected. This means we need to prepare for an electric vehicle future sooner than we once thought. Current major motor manufacturers must start adapting their strategies from traditional internal combustion engine manufacturing and hybrids, which is difficult given their long-term investment in these technologies.

Electric vehicle growth will undoubtedly see new brands enter the market to gain a share of this new demand. New EVs will be manufactured at greater scale, and new brands will form aftermarket offers and services tailored to these specific types of vehicles. Brands will also need to train staff on how to maintain these new vehicles and a greater number of products will be produced to cater to these vehicles’ needs. Even brands not involved in manufacturing these vehicles will look to benefit from this growth, possibly investing in EV charging infrastructure or ancillary products.

It is clear the global lockdown has changed how consumers are making purchase decisions; industries that seemed solid are at a standstill, while others are growing faster than expected. Although EVs are not the majority just yet, and consumer fears still need to be addressed, the future seems to be arriving quicker than expected.

The next normal is changing buying behaviours. Discover what that means for your brand with our proprietary tool – Sales Trigger™ Insight. The only methodology that can identify brand specific buying behaviour and deliver the marketing execution that matches it.

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