Discovering innovative business models for electric vehicle technology - Consumer Acceptance Session - Presented by Bob Oliver at the Fifth International Environmentally Friendly Vehicles Conference September 12, 2012, Baltimore
Electric vehicle technology is a product and experience that is new and unfamiliar to most consumers (who are generally risk-adverse) more expensive to build than conventional automobile technology (but probably less expensive to operate and maintain) occupying a different utility and performance envelope relative to conventional automobiles (e.g., range and refuelling characteristics) displacing demand for gasoline and diesel by powering transportation services with electricity (thus changing the sources and levels of air emissions in the sector with potential benefits to public health and environment) part of a convergence of technologies that involve electrical services, information management and clean transportation (i.e., smart grid systems) a technology distinct from conventional automobiles, with a potentially wider range of utility to a broader array of stakeholders 2
If electric vehicle (EV) technology is so different from conventional automobiles, then adapting the established auto sales and service business model to EVs is unlikely to work Therefore, My proposition: successful deployment and sustained use of EVs requires an innovative business model, in which the value of the technology is identified and oriented to an appropriate range of users, and the costs and risks of the investment are aggregated across those parties that derive benefit How do we discover the business model? Research to understand the barriers and opportunities Collaborate to produce compelling value propositions 3
Research the barriers and opportunities Working with MTO, Hydro One, Toronto Hydro and Ford Motor Co. of Canada, Pollution Probe and the Centre for Urban Energy at Ryerson University are conducting market research to identify and characterize the early adopter neighbourhoods for electric vehicles (project EMAP) Demographic/psychographic analyses Dwelling type, access to charging facilities Mobility patterns, performance expectations Purpose is to develop an infrastructure strategy to accommodate anticipated levels and patterns of EV use Images copyrighted by Pollution Probe 4
Research the barriers and opportunities With advanced technologies, such as EVs, the physical barriers are more complex, as well as the perceived barriers, compared to conventional vehicles The value proposition must address the barriers and reinforce the positive impressions The key motivations may not be economic! Images copyrighted by Pollution Probe 5
Collaborate on the value proposition Toronto EMAP research finds that consumer expectations and trust factors, if satisfied, can move product into early adopter markets To promote EV technologies, OEMutility collaborations may be the key Involving a third party can enhance credibility and enrich the value proposition Images copyrighted by Pollution Probe 6
Collaborate on the value proposition Beyond the consumer s need for personal transportation, what other opportunities do EVs offer and to whom? Utilities Expanded service offerings (adding transportation to home comfort and security) Enriched relationship with consumers (EVs coupled with smart meters could be the wedge product that opens up more communications-based services) Distribution asset management (e.g., demand response, energy storage) Other businesses, government Peer-to-peer car-sharing programs? Sustainable transportation strategy? 7
To summarize: successful deployment and sustained use of EVs requires an innovative business model, in which the value of the technology is identified and oriented to an appropriate range of users, and the costs and risks of the investment are aggregated across those parties that derive benefit; this requires Researching the barriers and opportunities Collaborating on the value proposition Pollution Probe recommends Recommendations Synthesize the findings of existing EV pilots and research projects into a signature report that enables key stakeholder groups to understand the nature and scope of the challenge and the potential benefits Convene those with a significant stake in the value proposition of EV technology in the development of a new, innovative business model 8
About Pollution Probe Non-profit registered charity, active donors in every province Work to improve human health & well-being through sound policy Sustaining revenue through industry and government collaboration on research and development, education, advocacy Ground-breaking research on electric vehicle business models Electric mobility master plan (EMMP) Electric mobility adoption & prediction (EMAP) Electric vehicle analysis for fleets (EVAN) Toronto Hydro smart Experience EV deployment pilot project Preparing to produce a comprehensive, signature experience report on EVs we are seeking financial contributions and project partners Support us. Engage us. We can be a valuable partner! 9
Thank You! Discovering innovative business models for electric vehicle technology - Consumer Acceptance Session - Presented by Bob Oliver, P.Eng., CEO, Pollution Probe 416.926.1907 x231 boliver@pollutionprobe.org