The rise of EV adoption: What are the opportunities for retail operators and landlords?
Electric Vehicle (EVs) sales in the UK increased by 180% in 2020 compared to the previous year, meaning EV’s now account for 6.6% of the overall UK car market (Autocar, 2021). The adoption of EVs has been on an upward trajectory since 2010, however, the sharp increase in sales over the past year can be attributed to three main factors:
- A more environmentally conscious public. CACI’s Covid-19 national surveys have identified that consumers are thinking more ethically.
- Significant investment from automotive firms into EVs and the infrastructure needed to support the transformation.
- Government legislation placing a ban of sales on new petrol and diesel cars by 2030.
The combination of the three factors above means that the industry is going through a dramatic transformation. However, the implications of EVs have a further reach than just the automotive sector as, at the end of the day, people use vehicles to get to places.
CACI conducted a survey with the objective of understanding firstly, the general perception of EV’s and secondly, how the adoption of a new technology will influence the way people interact with places.
Despite significant improvements made to battery ranges, 59% of survey respondents cited limited range as the main disadvantage of driving an EV. Combining this with the fact that EV owners are now having to wait +30 mins to charge up their car, electric vehicle owners are now having to “think ahead” and plan in order to mitigate the risk of running out of battery.
This is an important factor for the property sector to consider when developing short, and long-term strategies as consumer behaviour will be influenced as a result of the automotive industry’s transformation. The data behind the survey supported this viewpoint with 55% of all respondents stating that they would visit a specific location if they provided an EV charging point.
Whilst the data suggests there is a future opportunity to capitalise on, the data also strongly supports the theory that there is a present opportunity for landlords. When looking at those who currently own an EV, those willing to change their behaviour based on the supply of charging points then increased to 91%.
This means that retailers and landlords can win over new consumers by placing charging points at their sites, allowing EV drivers the convenience of charging up whilst shopping. Furthermore, for those who benefit from an affluent catchment, this opportunity is enhanced as Affluent Achievers and Rising Prosperity Acorn groups are most likely to be to changing where they shop based on the supply of charging points.
It is also important to look at the role of service stations given that EV drivers are now going to have to wait upwards of 30 minutes to charge their car up. Consequently, service stations may need investment to accommodate for different usage patterns considering the longer dwell periods. However, in the short term there may be an opportunity for retail and shopping parks to leverage their environments and target EV drivers passing by. This goes on the principle that the environment will play a more important role if drivers are having to stop for longer periods of time to charge their car up.
However, whilst the most immediate opportunities are within retail, residential properties and offices also need to take into consideration these implications.
With the speed at which EVs are now being adopted, whereby 53% of respondents stated that they will buy an EV within the next five years, landlords need to question if their sites have the infrastructure in place to support the adoption of Electric Vehicles.
If not, they risk lower rates of return as their assets depreciate at a faster rate due to the development becoming obsolete and outdated.
For further information about Electric Vehicles and CACI’s EV survey, please get in touch.