Monday, January 9, 2012

Interview: Doug Scott, Sr. Vice President, GfK Automotive

I recently had an interview with Doug Scott who is Sr. Vice President of GfK Automotive. He has more than 29 years of experience in the automotive and marketing research industries. He has also worked with automakers such as Toyota, Chrysler, and Subaru. Mr. Scott was a national research manager for Toyota Motor Sales before joining GfK.

GfK Automotive conducts research for the global automotive industry.

My interview with Doug Scott focused on the challenges that electric vehicles must overcome. Check out my interview below:

What are your thoughts on the sale figures of the Chevy Volt and Nissan Leaf?

The sales are disappointing thus far. Gas prices have declined which has changed the thoughts of many consumers. The Volt is a car that runs on electricity and gas but that comes with a premium you have to pay for. The Leaf is entirely electric but has the range anxiety issues. We found in our surveys, when you ask people whats the minimum acceptable range for a vehicle, they usually say between 150-175 miles. The fact is that the average commute that people drive is no more than 40 miles a day. Until someone comes out with other options or the Leaf boost it's range compacity past a 100 miles there will not be strong sales numbers. Americans don't want to give up their trucks or SUV's. The sale of trucks and SUV's have picked up again because of the market place. I think the issue is that 2011 was a disappointing year for the Volt and Leaf. The fact that regular conbustion cars, the Elantra's, Corolla's and Sentra's; you have the regulatory pressures on manufacturers that mandate fuel effeciency. This makes it extremely difficult to market the Volt and Leaf.

How do you think manufactures can overcome limited driving range?

There has to be a education program that needs to get out there. The current market conditions fight against alternative powertrains. It may be that Nissan and others have to get out there. Living in a southern city and just reassuring people that they can drive over the course of a day or so 70 some more miles. They have the flexibility of using their homes to charge their vehicles. It all comes down to educating the consumer. I was recently watching  television and the Nissan Leaf was quite prevalent in several commercials. But they are only available in select areas of the country. The manufactures need figure out ways to adapt these alternative powertrains for stop and go traffic and figure out ways to decrease the amount of energy that is used by the batteries. sucking down the energy of the system. There needs to be regulatory pressures for this to take place. Chevy recently said they were cutting back the production of the Chevy volt. Thats not what Chevy needs to do for the psychology of the car. But it is marketing, and its public relations that manufacturers are going to have to do and put their effort in.

What are your thoughts on plug-in hybrids i.e. Volvo Plug-in hybrid and Ford Fusion Plug-in hybrid?

Absolutely!, what you eliminate is range anxiety. Your stuck with the premium price and that's what you have to work on. You have to bring down the cost of your comparable vehicle with a smaller displacement engine. The diesel in the U.S. has a history of smelly and fuels. Most services which had a diesel pump gave it up. They are there to gas up your car. Toyota came up with a hybrid to take up that space. This was the transition of hybrid vehicles. I believe that plug-in hybrids will surpass electric cars because of their extended range. Hybrids are your gap filler as long as the price is down. Hydrogen cars and electric cars are a long way off before they both take a portion of automotive sales.

Are electric vehicles safe?

That's a 64 dollar question. I think what we have found is that they seem to be inherently safe but when their in an accident something has to be deactivated in order to be able to get to the person. I don't think we're seeing hybrid cars with batteries going up in flames. But I think what is happening is that during an accident or something of that nature we are seeing issues. Manufactures, such as Chevy has gotten out of their fast with their mechanical issues.

What do you think is more important to a person who is buying an electric vehicle: savings cost or emissions?

I think emmissions is way down on the list. Think of the population being segmented who are very green. You have a narrow band of people at 15% who want to reduce emissions. Then there are others who would purchase an electric vehicle if it didn't cost so much. I think the other issues of a pocket book nature, is does this save me any money in either maintenance? When gas prices keep going down the monetizing begins to look difficult to look at.

In the long run, does it make financial sense to purchase an electric car instead of a gas-powered vehicle?

The answer is only when the price gap is significantly reduced. You have a catch 22 there. But only when the regulatory pressure is put on the manufactures. Then there are people who don't want regulatory pressures. It's good to have regulatory rules by 2025 54 miles a gallon. There isn't the urgency of fuel resources and pollution on the other. Many people feel I can't afford 6 or 7 thousand dollars more for a vehicle. If later in the year we have another $5 a gallon for gas, there will be more Hyundai Elantras and Honda Civics bought. There's a catch twenty, two issues which are long range regulations, and the price of fuel.

I want to thank Tania Fonovic for putting this interview together. I also want to thank Doug Scott for taking out the time to answer my questions.

For more information on GfK Automotive check out their website:

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