There is no middle road, so to speak, when it comes to electric vehicles (EV) and opinion is­ split firmly into two sides. Those in favour see them as the future: a cleaner, cheaper and more efficient technology. Those against view them as inferior and costly and are holding onto petrol cars with fervour.

But love or loath, there’s no denying they are becoming a more viable and mainstream option among consumers. While once on the outer fringes of car choices, today’s EV owners are as likely to be suburban families as green-conscious, Elon Musk aficionados.

There are three main types of EVs, each with varying reliance on electricity to run. The first is a BEV — battery powered EVs that are 100 per cent run on electricity and which require charging through either a power grid or other source. The second, plug-in hybrids (PHEV), use batteries similar to BEVs, but also have an internal combustion engine. The last and most common form is a HEV, or hybrid vehicle, which operate similarly to BEVs, but can’t be plugged in for charging.

These models currently have a higher up-front purchase price — the NRMA estimates HEVs start from $26,500, PHEVs from $42,500 and BEVs from $47,500, however prices are expected to reach parity with petrol cars within a decade.

According to the Australian Electric Vehicle Study, commissioned in partnership with the Clean Energy Finance Corporation and prepared by Energeia, Australia could see a swift uptake of EVs among motorists. The study forecasts that by 2030, sales of EVs will reach 615,000 vehicles per annum, which will jump to 1.89 million each year by 2040, representing 49 per cent and 100 per cent of all new vehicle sales, respectively.

Within the next six years, close to a third (28 per cent) of new car sales are expected to be EV models, driven by a mix of reduced vehicle and battery prices and an increasing disparity between electricity and fuel prices. Sales over the next five years are set to rapidly spike and could jump from 3,100 to as high as 70,700 vehicle sales, the report says.

It’s not just the private sector embracing the technology. In NSW, the state government earlier this year announced a Net Zero Plan, which outlines its support for the technology and commitment to rolling out fast-charging infrastructure, incentivising purchases and ensuring new builds are set up for EV.

Under the plan, the government will also look at improving access to off-street charging. It has also pledged that 30 per cent of its fleet will comprise of either fully electric or hybrid vehicles by 2023, with at least 10 per cent to be fully electric. They also flagged potentially rolling out electric bus fleets and hybrid diesel-electric passenger trains on regional lines within three years.

The AEV report also crunched the numbers and found that EV cars could save motorists up to $1,300 in fuel and $300 in maintenance costs each year.

The recently released State of Electric Vehicles 2020 report by the Electric Vehicle Council found EV sales had jumped by 200 per cent last year. While petrol/diesel vehicle sales fell by 7.8 per cent in 2019, Australians purchased 6,718 EVs, accounting for 0.6 per cent of all new sales and three times the 2,216 EVs sold the previous year. In contrast, EVs account for between 2.5 to five per cent of all new vehicle sales in developed countries — with the very notable exception of Norway, where EV sales made up 56 per cent of all new cars. More than 2.6 million plug-in vehicles were sold last year.

Factors influencing consumer sentiment in favour of EVs are environmental concerns, cheaper running and maintenance costs and vehicle performance. The biggest barrier for consumers is the (relative) higher up-front purchase price.

Of these eight cost less than $65,000 and the Electric Vehicle Council expects to see six new models to be introduced into Australia by the end of the year, of which two will be under $50,000.

The council also ranked efforts across the states and territory governments to encourage EV uptake. NSW was found to have made the most progress last year, and is now ranked alongside the ACT and QLD, following NSW’s recent commitments to invest in public charging networks, transition vehicles within its fleet to EV models and electrify its bus fleet.

The QLD government also scored points for its investment in public charging infrastructure along its Electric Super Highway. While the ACT is electrifying its own car fleet and bus fleet and VIC, SA, WA and the NT are expected to release their EV strategies later this year.

Companies like Uber are already transitioning, announcing last month it plans to ensure 100 per cent of rides in the US, Canada and Europe will be in EVs by 2030 and by 2040 for the rest of the world. BP too has pledged to rapidly increase its charging points from 7,500 to 70,000 within 10 years.

CEO of the Australasian Association of Convenience Stores (AACS) Jeff Rogut believes it’s only a matter of time before we see a bigger uptake of EV in Australia, which he said lags behind other developed countries in the transition.

“Of course, charging infrastructure is essential to support take-up, and leading providers are already investing in their networks. For instance, Evie Networks is building Australia’s largest fast and ultra-fast charging network. Australia now has over 2,000 public charging points of which over 350 are fast charging. This represents a 40 per cent increase year on year,” Rogut said.

“With Federal Government support in the form of an EV policy comparable to mature global markets, the transition to electrification will accelerate.

“If we look at the US as an example, according to NACS, EVs are expected to increase their market share of new vehicles sold, because some of the challenges to owning an EV such as range anxiety, recharging time and purchase price, are being resolved in new models.

“At the same time, policies like zero-emission vehicle programs continue to spread throughout the US, creating a strong incentive for manufacturers to bring more EVs to market. Dozens of new models are expected to become available in the next few years,” he said.”

Rogut cautioned there were considerations for operators, and that there would need to be a balance between integrated charging stations and traditional fuel operations, but c-stores would become an important option for recharging as the uptake increases. This presents stores an opportunity to engage customers who will be on-site for 20-30 minutes and the success of the integration would largely depend on the offers available.

“It might be the provision of eat-in options, car-wash services, café-style ambience or other alternatives. The convenience channel has innovated around the in-store experience in recent years and the offer is understood to be more comfortable and engaging. The transition to EV will most likely elevate the importance of this experience further.”

However Rogut noted as with any shift of this significance, it would also come with challenges, such as the potential for fewer fuel destination trips.

“There will be changes along the entire value chain and operators will need to be prepared. Our channel innovates and evolves, and the increased take-up of EVs will call on our ability to innovate and evolve in the future. But the prep work starts now, if it hasn’t already.”

The technology also carries the potential for healthy profit margins and stores should be energised, not threatened by the opportunities, Rogut said.

“According to Evie Networks, more mature international EV markets demonstrate increased profitability for stores which have capitalised on the transition. We believe a similar opportunity exists in Australia, with customers remaining on-site for longer while charging, therefore opening up significant new opportunities for stores.”

Principal Analyst IHS Markit, South Asia Powertrain Forecasts Suraj Ghosh, however, argues there are barriers to the imminent uptake of EVs, describing it as a chicken and egg situation – we won’t see more charging stations until we see more EVs. As there is currently no government support either for manufacturing or purchase incentives such as customer tax subsidies, he said, the market was currently reliant on organic demand and was not reaching its uptake potential.

“Though EVs are hyped up and captures a lot of media attention, there are challenges to it becoming mainstream. For it to become mainstream, the parity gap has to be bridged in terms of price, range, ease of ownership and value,” Ghosh said.

Founder of ServoPro, Dan Armes said petrol operators were watching the market closely and positioning themselves to harness the technology, but many were reluctant to commit to installing stations until consumer demand picked up.

“In the current market EV charging stations are the most attractive option for petrol station operators but there are very few that have been installed. Most petrol station operators are currently waiting to see how the market develops. I do work with some operators who have installed EV charging stations but their use is very limited,” Armes said.

“Those building new petrol stations are putting in the infrastructure for an EV charging station like the electrical wiring and allocating space on their forecourt, but few are installing the charging stations at this stage.”

This article was written by Naomi White and originally appeared in the Oct/Nov issue of Convenience & Impulse Retailing magazine, which can be read online here.

*Thanks to Geoff Brady at Evie Networks for providing AACS data, AACS CEO Jeff Rogut, Principal Analyst HIS Markit, South Asia Powertrain Forecasts Suraj Ghosh and ServoPro Founder Dan Armes for contributing to this article.

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