What the Electric Vehicle (EV) Market Evolution Means for Suppliers and Consumers

By Mariyah Saifuddin

Podcast InsightsWhat does the evolving electric vehicles (EV) market mean for consumers and suppliers alike? William “Bill” Newman, industry executive advisor at SAP North America, shared his insights with us on our “Tech-Driven Business” podcast. 

From where the market is today to how companies can support the growth in EVs, Newman talks about one of the hottest top-of-mind topics of 2023.

The current market

Most people are familiar with the light passenger vehicle space, from battery electric vehicles to plug-in hybrid electric vehicles. However, in other parts of the vehicle space, the average consumer is generally unaware of the details of  fuel cell technology, which continues to evolve, particularly for the long haul. 

What’s on top of mind for consumers? Battery range (known as “range anxiety,” says Newman). The good news, according to Newman, is that battery density and the ability to charge a battery quickly using direct-current fast-charging methods. There is already some infrastructure that allows parallel DC fast-charging, and that will become more and more available. It is about not just needing more charging locations but that those locations be “quick, efficient, and effective.”

As we look at how to address the needs of consumers, suppliers get to think about how to make it easier and convenient depending on the geographic location. For instance, you may need heated environments for northern climates but  some sort of cover in warmer climates. At the end of 2022, Center of Automotive Research event sponsored by SAP dove deep into these topics.

How can tech companies support this evolving EV market?

    Energy provisioner: Similar to how consumers buy trim packages for their vehicles, consumers in the future may buy a trim package for a charging unit that would hang on the inside of their garage. These products need to be built as well as serviced and managed. With the potential for some fractal billing, a few pennies per kilowatt hour over time, there is a significant upside and revenue potential.

    Higher-density batteries / non-heavy metal batteries: Silicone, for instance, can be developed synthetically. This eliminates the need for mining and harvesting from tough-to-reach areas; locations with poor labor practices; or areas not politically friendly to Western markets.

    Shifting from front-driver experience to back-seat passenger experience: While traveling in a semi-autonomous vehicle that is electrified and may not have a steering wheel, people in those vehicles may actually feel more like they are in a rolling workplace or family space. That reality provides new opportunities for companies who provide interiors, lighting, sound and instrumentation.

    The evolving consumer experience

    According to Newman, there is a whole new market segment. This segment of the market applies not only to organizations that are building those interiors but also to technology companies that provide those accessories. In turn, it opens up opportunities for the consumers to have a different experience altogether in a vehicle.

    The Experiences Per Mile Advisory Council issued a report in 2022 that was the first report of its kind that suggested the utility or the “experience value”; in other words the value of an experience is different based on the purpose for that particular use of a vehicle. For instance, a passenger’s experience is different if that person is on a vacation road trip versus driving to the office or taking children to soccer practice.

    According to Newman, we are moving to a place, particularly with new EV design, where we are actually designing and then using vehicles that are specifically fit for a given purpose or a set of specific purposes. This suggests a huge differentiation in how companies create vehicles that are designed and personalized based on the needs of customers.  

    The role of sustainability

        • A movement to a make-to-market, so more of a regionalization, which is good ecologically.

        • The ability to figure out a way to manufacture EV technologies with less of a reliance on heavy materials that are often strip-mined and that have a tendency to devastate the environment of nations where those materials are being sourced.

        • Looking at Scope 1, 2 and possibly Scope 3 emissions requirements, along with significant tailpipe emission requirements and other rules that headed to the U.S. this year and beyond.

      Newman advises that if a manufacturer does not have rules in alignment, an unsuspecting EV owner can purchase a vehicle that was manufactured using inappropriate labor sources with materials that were mined in non-environmentally friendly ways and powered by non-environmentally friendly coal-fired electrical plants.

      Consumer decision making

      Here are some takeaways for consumers making decisions on whether to purchase and drive electric vehicles, according to Newman:

          • The environment: Recognize that just owning or driving an EV does not necessarily mean the consumer is being ecologically mindful. Some gas-powered vehicles might be designed and built in a more environmentally responsible way than some EVs. Take time to understand where the parts are coming from and how the company is operating.

          • Sustainability plays a huge role, Newman says. Expect to see more regulatory and reporting impacts as 2023 progresses. This impacts people who want to drive gas-powered vehicles as well. It is not a black-and-white scenario. Consumers will need to become familiar with the workings for their vehicles in order to ensure they are spending their money on vehicles and products that are based what sustainability means for them.
          • Decide on level of commitment and timing. Newman believes that consumers need to decide what kind of impact they want to make and how early they want to act. For those people who want to make an impact immediately and feel good about what they are doing over the next five to 10 years in regard to the environment, Newman suggests buying a plug-in hybrid electric vehicle. It’s proven technology. 
          • Buying hybrid? If a consumer does buy hybrid, Newman reiterates: Plug it in. Do not drive it like a gas-powered vehicle because someone who does this is no better off than if they were filling up at the gas station. 
          • All in on EV? If consumers feel compelled to buy a full battery electric vehicle (BEV), understand that the technology is going to significantly improve and with that they will see improvements in vehicle performance and comfort. 
          • Long haul use: Lastly, consumers should plan to drive the car for 10+ years; that is how they’re built. This is a real change in the mindset, particularly for North American auto consumers who, as recently as 20 years ago, generally bought or leased a new car every four to six years.plus.”

        Interested in more Tech-Driven Business podcasts? You can listen here

        About Bill Newman

        William "Bill" NewmanWilliam Newman is an industry executive advisor (chief) for SAP’s Customer Innovation Office. He has more than 35 years of executive leadership, strategy, consulting, practice management experience balanced with extensive public speaking and higher education experience.

         A former leadership team member for Volkswagen’s IT division, he is the author of two books on enterprise performance and has worked with many OEMs and suppliers across the automotive industry. 

        Additional Resources

        Recent Posts
        Media Inquiries

        Mariyah Saifuddin

        Email: info@isolutionpartners.com