Electric Cars: What's Preventing Mass Adoption?

Posted on Feb 7, 2021

If you want to know more about my analysis, I encourage you to visit the app at Shiny App or shoot me a message on LinkedIn. You can also visit my Github repo for the code.

Problem

Electric Cars are vehicles that are powered, either fully or partially, by a battery instead of a traditional combustion engine. They are a powerful weapon in the fight against climate change as they cut carbon emissions almost completely. Moreover, they are cheaper to operate, as electric cars can be recharged for less than the cost to refuel a traditional car. Even so, the market has not responded well: electric cars have barely captured 1% of the market. In this post, I will investigate the possible reasons why.

Two Types of Electric Cars

Just as there are a variety of technologies available in conventional vehicles, plug-in electric vehicles (also known as electric cars or EVs) have different capabilities tailored to different drivers’ needs. A major feature of EVs is that drivers can plug them in to charge from an off-board electric power source. This distinguishes them from plug-in hybrid electric vehicles (PHEVs), which supplement an internal combustion engine with battery power.

I will consider only EVs in this analysis.

Current Market Share

Despite often making headlines, electric cars have a tiny market share of the entire car sales industry in the United States. The graph below shows impressive growth in the market share of EVs but when we look at the scale to the left, we can clearly see the challenge facing electric cars — they barely exceed 1 percent of the entire car sales industry.

EV Market Share (Source: InsideEvs)

Industry Leaders

In investigating the EV market, I found the top three models by total car sales.

EV industry leaders

Unsurprisingly, Tesla wins the gold with its most popular model being the Model 3. We can also see that Nissan and Chevrolet are also doing quite well given how small the market really is. The Nissan Leaf takes third place with a total sales of 132,214, not far behind the Tesla Model S with a total sales of 157,992. There might be a reason why the Tesla Model 3 outperforms the other cars and in order to understand why, we need to investigate what the market actually want.

What People Want in an Electric Car?

A survey of 1000 participants by Castrol found that the average consumer would buy an electric car if it were below $40,000 and had a range of over 319 miles on a single charge. Now that we know this, let's see what is the state of the current market.

Current market
Current Market (Source: Various Manufacturers' websites)

In the image above, I plotted the Manufacturer Suggested Retail Price (MSRP) of many cars against their ranges. I also highlighted the area that the survey participants consider to be the sweet spot for an electric car. The chart illuminates the reason why electric cars are not common yet.

We can see that most electric cars fall outside of the "golden zone" with the notable exception of Tesla's Model 3, the most successful electric car by total sales. It is now apparent that car manufacturers are simply not matching the expectations of the market.

There are two reasons why that might be:

  • They do not possess the technology to produce a car in the "golden zone"
  • They have not figured out what the golden zone is.

In my opinion, the former reason is more likely to be true.

Moreover, other external reasons exist that could dissuade people from buying an electric car. Firstly, the charging network could be too sparse to be reliable. Consumers are used to quick and easy refueling and electric cars need to match that comfort level to stand a chance. Secondly, gas prices could be plummeting and thus making combustion engine cars more competitive.

Conclusion

I believe that once the technology reaches a point where manufacturers can make more powerful and long-lasting batteries, more and more cars will fall into the "golden zone" and thus creating a boom in the industry.

About Author

Darish Sakeesing

Darish is a resourceful and results-driven student who is completing a Master’s degree in Data Analytics with a concentration in Databases at the Touro College. He is also a Fellow at the DataScience Academy where he employs machine...
View all posts by Darish Sakeesing >

Related Articles

Leave a Comment

No comments found.

View Posts by Categories


Our Recent Popular Posts


View Posts by Tags

#python #trainwithnycdsa 2019 2020 Revenue 3-points agriculture air quality airbnb airline alcohol Alex Baransky algorithm alumni Alumni Interview Alumni Reviews Alumni Spotlight alumni story Alumnus ames dataset ames housing dataset apartment rent API Application artist aws bank loans beautiful soup Best Bootcamp Best Data Science 2019 Best Data Science Bootcamp Best Data Science Bootcamp 2020 Best Ranked Big Data Book Launch Book-Signing bootcamp Bootcamp Alumni Bootcamp Prep boston safety Bundles cake recipe California Cancer Research capstone car price Career Career Day citibike classic cars classpass clustering Coding Course Demo Course Report covid 19 credit credit card crime frequency crops D3.js data data analysis Data Analyst data analytics data for tripadvisor reviews data science Data Science Academy Data Science Bootcamp Data science jobs Data Science Reviews Data Scientist Data Scientist Jobs data visualization database Deep Learning Demo Day Discount disney dplyr drug data e-commerce economy employee employee burnout employer networking environment feature engineering Finance Financial Data Science fitness studio Flask flight delay gbm Get Hired ggplot2 googleVis H20 Hadoop hallmark holiday movie happiness healthcare frauds higgs boson Hiring hiring partner events Hiring Partners hotels housing housing data housing predictions housing price hy-vee Income Industry Experts Injuries Instructor Blog Instructor Interview insurance italki Job Job Placement Jobs Jon Krohn JP Morgan Chase Kaggle Kickstarter las vegas airport lasso regression Lead Data Scienctist Lead Data Scientist leaflet league linear regression Logistic Regression machine learning Maps market matplotlib Medical Research Meet the team meetup methal health miami beach movie music Napoli NBA netflix Networking neural network Neural networks New Courses NHL nlp NYC NYC Data Science nyc data science academy NYC Open Data nyc property NYCDSA NYCDSA Alumni Online Online Bootcamp Online Training Open Data painter pandas Part-time performance phoenix pollutants Portfolio Development precision measurement prediction Prework Programming public safety PwC python Python Data Analysis python machine learning python scrapy python web scraping python webscraping Python Workshop R R Data Analysis R language R Programming R Shiny r studio R Visualization R Workshop R-bloggers random forest Ranking recommendation recommendation system regression Remote remote data science bootcamp Scrapy scrapy visualization seaborn seafood type Selenium sentiment analysis sentiment classification Shiny Shiny Dashboard Spark Special Special Summer Sports statistics streaming Student Interview Student Showcase SVM Switchup Tableau teachers team team performance TensorFlow Testimonial tf-idf Top Data Science Bootcamp Top manufacturing companies Transfers tweets twitter videos visualization wallstreet wallstreetbets web scraping Weekend Course What to expect whiskey whiskeyadvocate wildfire word cloud word2vec XGBoost yelp youtube trending ZORI