'Going green'? Immersion into a grey area in Chinese automotive consumers' minds

'The earth is blue like an orange', a French surrealist poet used a say… And Chinese automotive world is still green like an exhaust pipe or a smoke cloud, automotive manufacturers could similarly say…

More than 6 years after the introduction of Toyota Prius in China, and less than 1 year after the launch of the first electric BYD e6, talking about green in the auto industry still sounds like a surrealist association: in 2011, only 8,159 hybrid/EV cars were sold in China, and part of them to the Chinese government, who bought electric bus and taxi as part of the 'New Energy Vehicle Program'. If China is leading worldwide automotive growth, it is not yet at the fore front of the specific green segment. The government is concerned about this slow pace and in April 2012 announced its objective is to have 5 million green vehicles in circulation by 2020. To help reaching the objective set, it plans to invest 100 million RMB, which will be split between subsidizes customers, supports manufacturers' R&D programs and accelerates the development of charging station for electrical cars.

Is government scheme alone likely to change Chinese consumers' attitudes and ultimately their behaviors towards hybrid and EV cars? Is money the only barrier from consumers purchasing a green car in China?

To investigate this 'grey area' in consumers' mindset, TNS China conducted several researches amongst Chinese car owners, as well as intenders planning to purchase a new vehicle within the next 12 months. The results of these investigations portray a more complex picture of consumers' mindset when related to green cars, rather than cost concern alone.

Indeed it appears that, before the old tune "We should" became a successful "I do", China still has 4 key hurdles to overcome:

-First and foremost, acknowledging that car emissions damage the environment, and that resolving this issue is an absolute necessity

-Secondly, market offerings available - the EV and hybrid cars - to solve such an issue

-Thirdly, making sure the benefits of green car match with the needs of drivers

-Last but not least, being able to address the remaining frictions

1-"WE SHOULD DRIVE GREEN TO PROTECT THE ENVIRONMENT": A WIDE CONSENSUS IN CHINA

Chinese car owners aren't in denial regarding pollution: they are all fully aware that the environment has been damaged, and 74% of which even consider that it has been seriously damaged. They are especially concerned about air and water pollution and its direct impact on their health.

Most of them also agree that solving this environmental crisis is now becoming urgent, if irreversible damages are to avoid.

More than ? of Chinese drivers point out more specifically the negative impact of passenger cars, and express belief in the evolution of the engine technology to solve it.

The first key hurdle to a "greener China" has therefore been cleared.

2-IF WE WANT, CAN WE REALLY DRIVE GREEN?

When it comes to market offering, we are forced to admit that it is still very limited.

Although most of the manufacturers have EV or Hybrid technology in their product plans (Roewe E50, Denza), the driver who is willing to buy such a car today are restricted to very few alternatives.

The list of EV or hybrid models currently available doesn't exceed 20, while the complete range of car models accounts for more than 450. And for pure EV, the choice is even more limited, with less than 5 models available!

For consumers, it is therefore difficult to find a green model which may be on the expected segment and price range.

The second hurdle therefore has to remain. Product offerings need to increase so that green cars may become an actual alternative to the petrol engine ones.

3-DRIVING GREEN IS STILL SYNONYMOUS OF RENOUNCIATION FOR CHINESE DRIVERS - WHAT ARE THE REAL BENEFITS

To date, the perceived benefits of green vehicles do not fulfill drivers' expectations towards cars.

Chinese car drivers expect convenience, reliability, safety, exhilarating drives, comfort, prestige, and value for money from the car they drive.

While hybrid and EV technology is perceived as innovative, distinctive and obviously fuel efficient and ecological, Chinese drivers deny to such 'futuristic cars' and question its capabilities to be yet reliable, powerful, safe, affordable and practical. Although most of these allegations are unfounded, there is a long way to go to turn upside down consumers' perception, and to convince them that green cars are now at the eye level with traditional engine types in these key areas.

4- 3 LAYERS OF FRICTIONS TO BE SOLVED

To get Chinese car drivers more committed to adopt a "driving green" mind set, several frictions need to be addressed.

Firstly, car buyers consider more the economic criteria than the ecologic one during their purchasing process. Emphasizing the cost per KM, or the overall cost of ownership of EV hybrid cars should help to move from a pure ecological USP to an 'Ecolo-nomical' ones.

Secondly, a need to correct the reality distortion syndrome that currently penalizes the EV-hybrid driving capability. Experiencing the drive of a hybrid or EV car would obviously demonstrate the exhilaration that it provides to its driver; powerful accelerations, smooth ride and absolute comfort of driving are some of them.

Information and education would be the keys to success to change attitudes and overcome resistances.

Thirdly, focus on the low level perception of convenience/practicability of green technology vehicles.

Current EV cars require a wide network of charging stations to provide as much convenience of usage as the traditional engine cars.

Charging time and limited autonomy are definitely areas where improvement is required. Although the investment was huge over the past years, to date the most noticeable achievement observed is for captive vehicle fleet, i.e. buses, coaches, taxis and big corporation car fleets, etc.. To make the implementation of such an efficient infrastructure wider and beneficial to the private car drivers, a perfect coordination of the various stakeholders involved is required. That's why the role of officials, energy suppliers and manufacturers will be determinant to the success of the "Drive Green (R)Evolution" in China.

With all manufacturers investing massively in China and developing more EV cars to be launched over the next 24 months, with a government willing to invest for aeco-friendly car industry, and with car drivers aware of the necessity to limit car emissions, one can reasonably dream about a greener future for the automotive industry.

The last hurdle to overcome remains the necessary change in consumers' mindsets, regarding the benefits that EV and hybrid cars may offer. This is where marketers will play a key role, get onboard with officials, engineers and consumers in the green winning team.

The Driving Green (R)Evolution is a battle that will be won with team work, or that will be lost. Hopefully, China team can be on this field as successful as they do on the Olympics Games.

About TNS China:

TNS advises clients on specific growth strategies around new market entry, innovation, brand switching and stakeholder management, based on long-established expertise and market-leading solutions. With a presence in over 80 countries, TNS has more conversations with the world’s consumers than anyone else and understands individual human behaviours and attitudes across every cultural, economic and political region of the world.

TNS China is the leading custom market research agency in China. With around 500 employees and more than 200 researchers across 5 offices in China, we deliver actionable insights and research-based business advice to our clients so that they can make more effective business decisions. We are committed to helping local leading companies win in both China and global markets and multi-national companies be successful in China.