Analysis of the Electric Vehicle Industry

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Creating the Clean Energy,Analysis of the Electric Vehicle Industry. Primary Authors, Jennifer Todd is an Economic Development Associate at IEDC Jess Chen is a Research Fellow and. a PhD candidate at American University Frankie Clogston is an IEDC Consultant and a PhD. candidate at Johns Hopkins University,Primary Editors. Liz Thorstensen Vice President of Knowledge Management Economic Development Practice Tye. Libby Associate Knowledge Management and Development. Acknowledgements, IEDC is grateful to the Rockefeller Brothers Fund for its generous support of this research project. Special thanks Lauren Avioli Emily Brown and Patrick McHugh for research support and Mishka. Parkins who provided technical assistance for the creative design of the report. Copyright 2013 International Economic Development Council. This report was made possible by a grant from the Rockefeller Brothers Fund. International Economic Development Council, IEDC is the world s largest membership organization serving the economic development.
profession with over 4 500 members and a network of over 25 000 economic development. professionals and allies From public to private rural to urban and local to international our. members represent the entire range of economic development experience IEDC is dedicated to. helping economic developers do their job more effectively and raising the profile of the. profession When we succeed our members create more high quality jobs develop more vibrant. communities and generally improve the quality of life in their regions. The issue of sustainability has been designated a strategic priority by the IEDC Board of. Directors Further sustainability and policy responses to climate change are growing issues for our. members Through a range of services including conferences training courses webinars. publications research and technical assistance efforts we are striving to be on the cutting edge. of understanding the opportunities and challenges stemming from sustainability climate change. and economic transformation For more information about IEDC visit www iedconline org. Paul Krutko FM,President and Chief Executive Officer. Ann Arbor SPARK,Chairman of the IEDC Board,Jay C Moon CEcD FM. President and CEO,Mississippi Manufacturers Association. Immediate Past Chairman of the IEDC Board,Jeffrey A Finkle CEcD. President CEO,International Economic Development Council.
International Economic Development Council,734 15th Street NW Suite 900. Washington DC 20005, www iedconline org Phone 202 223 7800 Fax 202 223 4745. TA B LE O F CO NT E NTS,Introduction to Electric Vehicles 4. Job Creation Potential of Electric Vehicles 12,The State of the U S Electric Vehicle Market 23. Hurdles and Solutions Electric Vehicles Market 61,Reduce the Cost of PEVs 63.
Expand Charging Infrastructure 73,Educate Consumer Perception 83. Convention Gas Cars Lessons for Electric Vehicles 90. INTERNATIONAL ECONOMIC DEVELOPMENT COUNCIL 3,INTR O DU CTIO N T O ELE CT R IC. V EH ICL E S, Of all the oil consumed in the U S 70 percent is used for transportation Further passenger. vehicles use 70 percent of transportation oil 1 Globally a rising middle class in China and India is. causing demand for passenger cars to balloon and with it demand for oil By 2050 there may. be as many as 1 5 billion cars on the road compared to 750 million in 2010 2. This type of demand represents both a challenge and an opportunity to capitalize on new vehicle. technologies and in the process reap substantial economic development benefits In a world. where oil is a limited resource an alternate source of transportation fuel electricity is not only. a smart investment but as some would say it is an inevitable one Further the switch to electric. vehicles will generate demand for existing jobs and create new jobs as well As study after study. confirms job growth in electric vehicle industries will outweigh any reduction of jobs in traditional. fuel industries resulting in net job growth Electric vehicles create additional economic. development opportunities by improving quality of life reducing energy spending and. decreasing reliance on foreign oil, The Importance of Electric Vehicles to Economic Development. Like any transformative new technology electric vehicles create a variety of potent economic. development challenges and opportunities While the electric vehicle market is still at a relatively. early stage of development it is poised to reshape industries and communities the world over. This section provides a quick overview of the potential benefits of electric vehicles so that. economic developers can better assess what the evolution of this market will mean to their specific. local communities, 1 Harvard Kennedy School Belfer Center for Science and International Affairs 2011 July Will Electric Cars.
Transform the U S Car Market Cambridge Lee H Lovellette G Retrieved from. http belfercenter ksg harvard edu files Lee 20Lovellette 20Electric 20Vehicles 20DP 202011 20web pdf. 2 Harvard Kennedy School Belfer Center for Science and International Affairs 2011 July Will Electric Cars. Transform the U S Car Market Cambridge Lee H Lovellette G Retrieved from. http belfercenter ksg harvard edu files Lee 20Lovellette 20Electric 20Vehicles 20DP 202011 20web pdf. INTERNATIONAL ECONOMIC DEVELOPMENT COUNCIL 4,Electric Vehicles Create Jobs. At this point it is difficult to reliably estimate the total job creation potential of electric vehicles. More electric vehicles however would also likely lead to some job losses in the oil industry With. that said there is good reason to expect that electrification of personal transportation can drive. job creation in a host of industries More efficient automobiles require more technology which are. designed and produced by adding workers to the auto industry 3 Many of these jobs would be. created in industrial sectors closely tied to auto manufacturing advanced batteries and research. and development, Moreover electric vehicles are much cheaper to operate than conventional vehicles Drivers who. switch to electric vehicles will have more disposable income to spend in other sectors of the. economy such as housing and services Spending in these sectors keeps more wealth moving within. local economies and will drive job creation in sectors not immediately connected to producing. electric vehicles, These ideas are summed up in the different types of job creation Direct jobs are created through. increased production by firms that make PEVs PEV components and PEV infrastructure Indirect. jobs are those tied to firms that supply to these direct producers Further higher employment in. direct and indirect jobs leads to more spending in the broader economy These create induced. jobs in industries like food clothing and entertainment One leading estimate of total job creation. from PEVs direct indirect and induced is that provided by the BlueGreen Alliance American. Council for an Energy Efficient Economy The organization predicts that the new federal vehicle. standards passed in 2012 will result in the creation of 570 000 jobs including 50 000 in vehicle. manufacturing 4, Electric Vehicle Infrastructure Improves Quality of Life. Early adopters of electric vehicles face significant constraints in where they can live and work. Before charging infrastructure becomes widespread communities that can offer adequate. charging locations and PEV purchase incentives will have an advantage in attracting and. 3 BlueGreen Alliance American Council for Energy Efficient Economy June 2012 Gearing Up Smart Standards. Create Good Jobs Building Cleaner Cars Washington D C Retrieved from http www drivinggrowth org wp. content uploads 2012 06 BGA Auto Report pdf,INTERNATIONAL ECONOMIC DEVELOPMENT COUNCIL 5.
retaining workers who want to make the switch to electrified transportation Critically from an. economic development perspective there is good reason to expect that early adopters of electric. vehicles will also be highly talented workers Surveys of buyers who preordered the Nissan Leaf. indicate they are an educated and tech savvy group In fact the average Leaf buyer is. Around 45 years old,Owns a home and a garage,Makes about 125 000 a year. Is college educated and, Already owns a fuel efficient vehicle such as the Toyota Prius 5. Surveys by the University of Michigan and Pike Research found that the more education a person. has the more likely he or she is to be interested in purchasing a plug in hybrid vehicle 6 Those with. higher income are also more likely to purchase a PEV 7 However a Deloitte survey found that. even these early adopters are sensitive to government incentives and overall cost considerations 8. Thus communities that adopt charging infrastructure and offer purchase incentives can strengthen. their appeal to these educated wealthier workers, Electric Vehicles Can Reduce Reliance on Foreign Oil. According to the U S Energy Information Administration over 80 percent of the cost of a gallon. of gas immediately leaves the local economy 9 Further higher gas prices means retailers typically. charge a lower markup in an attempt to compete thereby reducing local profits even more 10. 5 Gordon Bloomfield N 2010 September 10 Just Who is a Typical 2011 Nissan Leaf Buyer We Find Out Green. Car Reports Retrieved from http www greencarreports com news 1049202 just who is a typical 2011 nissan. leaf buyer we find out, 6 University of Michigan 2009 Plug In Hybrid Electric Vehicles Ann Arbor Curtin R Shrago Y Mikkelson J. Retrieved from http www ns umich edu Releases 2009 Oct09 PHEV Curtin pdf. Pike Research 2011 Electric Vehicle Consumer Survey Boulder Vyas C Hurst D Gartner J Retrieved from. http www pikeresearch com wordpress wp content uploads 2011 12 EVCS 11 Executive Summary pdf. 8 Deloitte April 2011 Gaining Traction Will consumers ride the electric vehicle wave Retrieved from. http www deloitte com assets Dcom Australia Local 20Assets Documents news. research Press 20releases Deloitte 20EV 20Survey 20Summary 20Findings pdf. 9 U S Energy Information Administration 2012 September 10 Gasoline and Diesel Fuel Update Retrieved from. http www eia gov petroleum gasdiesel, 10 National Association of Convenience Stores 2011 NACS Annual Fuels Report 2011 Retrieved from.
http www nacsonline com NACS Resources campaigns GasPrices 2011 Documents GasPriceKit2011 pdf. INTERNATIONAL ECONOMIC DEVELOPMENT COUNCIL 6, Most communities are not significant producers of oil and gas for personal transportation which. means that when local residents spend money at the gas pump much of that wealth exits the local. Savings on gas can add up to significant benefits to regional economies Not all of the savings will. be spent locally but even a fraction of what is spent annually on personal transportation has the. potential to bolster job growth and build wealth within local economies A study by the California. Electric Transportation Coalition found that each dollar saved from gas spending and spent on. other household goods and services generates 16 jobs in the state 11 A few specific examples. underscore how significant the import substitution effect of electric vehicles can be New Yorkers. drive much less than the average U S metro resident which keeps 19 billion each year flowing. within the local economy 12 In Portland Oregon residents drive only four miles less per day than. the national urban average but the fuel savings still result in 2 6 billion dollars each year. staying local 13, With savings of these magnitudes being realized by trimming only a few miles off the national. driving average it is clear that decreasing operational costs of vehicles can add up to massive. amounts of wealth staying local and creating jobs Electric vehicles prevent local wealth from. being literally pumped away and as these examples make clear the gains to local economies. can be significant,Electric Vehicles Can Decrease Utility Prices. Electric vehicles have the potential to decrease or at least moderate the growth of utility rates. For a technology that will increase total demand for electricity this may seem counter intuitive. The reason that electric vehicles may actually decrease utility rates lies in daily oscillations in. power consumption Electric vehicles typically charge at night when electricity is cheapest to. 11 California Electric Transportation Coalition 2012 Plug in Electric Vehicle Deployment in California An Economic. Jobs Assessment Retrieved from http www caletc com wp content uploads 2012 11 Economic Jobs Assessment. Exec Summary pdf, 12 Cortright J 2010 April New York City s Green Dividend CEOs for Cities Retrieved from. http www ceosforcities org pagefiles NYCGD elctrnc FINAL pdf. 13 Cortright J 2007 June 28 Portland s Green Dividend CEOs for Cities Retrieved from. http www ceosforcities org files PGD 20FINAL pdf,INTERNATIONAL ECONOMIC DEVELOPMENT COUNCIL 7.
generate By balancing the demand for electricity between day and night electric vehicles. decrease the average cost of electricity Thus overall rates decrease. One potential future technology allows vehicles to feed electricity back into the grid a reverse. charge system known as vehicle to grid V2G Peak hours of electricity demand generally occur. in the early to mid afternoon when most commuter vehicles are sitting idle and can feed power. back into the grid 14 Conversely electric vehicles are generally charging in the later evening. means that when local residents spend money at the gas pump much of that wealth exits the local economy Savings on gas can add up to significant benefits to regional economies Not all of the savings will be spent locally but even a fraction of what is spent annually on personal transportation has the potential to bolster job growth and build wealth within local economies A study by the

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