Fleet EV News sat down with Carly Car Subscription CEO Chris Noone recently, to discuss electric vehicle market trends, ‘early majority’ confidence and the future of fleet electrification.
Fleet EV News: Thanks for sitting down with us, Chris. How do you feel the EV market is tracking in Australia and what hurdles does it face?
Chris Noone: I think it’s tracking quite well, and I certainly think the transition is underway. But the overriding thing about both individual and fleet purchasing is there’s a lot of confusion in the market. A lot of people are being told they should be transitioning to electric vehicles, but it’s actually quite a big decision. It’s not just buying another car, it’s investing in a whole new technology.
The polarising media landscape can’t be helping, right?
It’s very polarised at the moment. There are two sides to the discussion, which is ‘EVs are the best thing ever, you’re an idiot if you don’t drive one’, and then ‘EVs are the worst things ever, your’re an idiot if you drive one’. So there’s a lot more opportunity for that nuance in the middle, for people to say, yes, they are really great for these applications. But you’ve also got to understand where they’re probably not the best technology, and perhaps a hybrid or a plug-in hybrid, or maybe even an ICE vehicle, for a period of time may be the best solution for that application.
At what point do you think consumer confidence will flip – is it when residual values get better, when range improves, or is it simply going to take time?
It’s when the early majority start to talk to their friends and say, ‘hey, I stood back a bit, I waited a while, but now I’m happy with it’. That’s where I think a lot of people get a lot of confidence, because they’ll say, ‘well, that person’s like me, and it works well for them’. It’s not just these geeky early adopters who, you know, would have bought the technology regardless of how good it was. The early adopters were going to buy EVs anyway, they did their own research, they were prepared to pay over the odds. But the mass market is not prepared to do that, they want more convincing that it’s the right thing for them to do.
So this trend we’re seeing at the moment, where hybrid sales are up and EV sales are down, do you think it’ll continue?
We’re looking at deliveries of vehicles within the last few months, which does not equate to orders of vehicles in the last few months. So some of those deliveries are really skewing the figures and I don’t think they’re showing current intent. They are showing a mix of current intent and intent from 12 to 18 months ago as well, and we know a lot of those hybrids are going into fleets that had orders in the pipeline for quite a long time but are finally getting deliveries. So I still think we need to wait a few months to understand what’s really happening from the intent point of view.
While we’re on the topic of hybrids…do many Carly Car Subscription customers ask for them or is it primarily EVs they’re interested in?
Not really, no. Our average subscription period is over five months, and for that sort of application people are a little bit more open as to what sort of vehicle they are using. It’s not a four- to five-year investment, it’s a stopgap solution. We don’t have any hybrids or plug-in hybrids because the main proposition we’re providing for people is the opportunity to trial the vehicles and you’re not really going to learn much about a hybrid. You just keep putting petrol in, it keeps using electricity as well, and keeps going. With a plug-in hybrid, yes there’s a little bit more of a learning curve there, but the research shows that when people have got plug-in hybrids, they don’t often plug them in.
Your recently-launched EV Trial service allows business customers, or fleet operators, to try an electric vehicle to see if it fits their application. How is it going so far?
We started in March of this year and it’s increasing quite rapidly. What we find with the EV Trial product is that people are looking to take an electric vehicle so they can understand the technology. The majority of our subscriptions that are occurring on electric vehicles are coming from that EV Trial acquisition method.
Do you feel the EV Trial product is dispelling some of the ‘for and against’ electric rumours, given that’s a real issue for the EV market right now?
It gives people confidence. There are a lot of mixed messages in the market at the moment, but what we try to push is answer your own questions by actually trying it for yourself. If we can, give them a few months in an EV they can say, ‘I understand all the pros and cons, I understand all the advantages, now I’m ready to go and buy an EV or take a lease for four years’. We want to give people confidence to make an informed purchase decision.
It sounds like the EV Trial might be just what the market needs right now. In ending Chris, do you think EV sales will continue to grow in Australia or has the market plateaued for now?
We think it’s going to continue to increase as a proportion of total sales, and we can see that the sales of ICE vehicles are declining. You can maybe look into the future by looking at the ACT at the moment, where 20 percent of sales are EVs. We still have the FBT exemption for the novated leases, that’s due to continue for a while, and a lot more people are becoming aware of it. You’re also starting to see more EVs on the road, and people are gaining confidence, and a lot of it will be through word of mouth as well.
Thanks for your time, Chris!
