Friday, July 17, 2020

A missing link in green car marketing

One of the reasons why automakers have advocated weaker fuel economy and greenhouse gas (GHG) emission standards is that lower-than-expected fuel prices have lessened consumer interest in higher fuel economy. Although insufficient consumer interest relative to environmental need is the main reason why regulations are needed, lack of consumer interest is a legitimate concern. The challenge is quite real when the market is pulling one way while regulations are pulling another.

Nevertheless, environmental need -- and indeed policy-fostering public sentiment to address global warming -- does not go down when pump prices fall.

It is now well recognized that, to advance electric vehicles, extensive social marketing efforts are needed in addition to incentives, regulations and investments in charging infrastructure. But EVs are a slow slog in terms of market gains and, for cost and convenience reasons, likely to remain so for some time. For at least the next decade, EV promotion is poorly leveraged for reducing emissions at meaningful scales.

Significant emission reductions require fleet-wide gains in fuel economy. Climate concerns dictate that such gains be much greater than those to be seen under the near-flatlining of CAFE standards recently done at the industry's behest.

In spite of this need, no comparable social marketing effort is being directed to encourage consumers to choose more fuel-efficient vehicles whatever the market segment. This void is a missing link in the overall effort to reduce auto sector GHG emissions.

A large number of consumers do have environmental concerns, a fact borne out by numerous surveys in recent years. For example, the University of Michigan Energy Survey found that, since fuel prices fell several years ago, Americans are more concerned about the environmental impact of energy than they are about its cost. But little is being done to tap this sentiment when it comes to car shopping.

In a piece for Automotive News two years ago, I asked "Why aren't automakers connecting better with green-minded consumers?" That question is even more salient today.