Are eco-conscious customers and employees influencing businesses to make the switch to electric vehicles? A new study by business loan comparison site, Small Business Loans Australia reveals that 39% of businesses would buy an EV to meet customer or employee expectations, while 30% would switch to an EV to boost their brand credibility and relevance.

The research was based on a survey of an independent panel of 202 Australian SME business owners and decision-makers, who were asked to identify the factors motivating their companies to purchase an electric vehicle, beyond government incentives and environmental considerations.

Electric vehicle purchases have shown a 120% rise from January to June this year over the same period last year, with 8.4% of all new vehicle purchases being electric [1]. So what’s driving businesses to invest in EVs?

According to the study, the competitive Australian SME landscape means businesses are conscious of their brand perception and are looking for ways to improve their credibility. With 62% of customers saying they feel an emotional connection with the brands they buy [2], it is essential that businesses are in tune with the beliefs of their customers to establish and nurture a connection.

Apart from brand credibility and customer expectations, being seen as an early adopter of EVs was a motivating factor for 28% of the respondents. Only 16% would invest purely because they see the purchase of petrol vehicles as a ‘bad look’, while 32% preferred EVs for their longer lifespan compared to petrol cars.

Across the major Australian states, South Australian businesses were the most likely to embrace electric vehicles to boost brand credibility and relevance (39%), followed by Western Australia (36%), Victoria (33%), and New South Wales (29%).

In terms of longer lifespan being an important consideration for choosing EVs, Queensland businesses led the way at 37%, followed by Victoria and South Australia (35%), and Western Australia (34%).

Employee expectations would motivate 42% of businesses in New South Wales and Western Australia to invest in electric vehicles, followed by Victoria and South Australia (40%), and Queensland (28%).

On the other hand, customer expectations would make 50% of New South Wales businesses to choose EVs, followed by South Australia (46%), Western Australia (41%), Victoria (35%) and Queensland (28%).

However, 71% of the businesses surveyed also believe that purchasing electric vehicles would help alleviate the current climate crisis.

Alon Rajic, founder and managing director of Small Business Loans Australia, says: “While each state has their own needs and goals, it is evident that businesses are ready to make the switch to electric vehicles for several reasons. In an economic climate where businesses are striving to gain new customers and retain current staff, as well as bearing a corporate social responsibility around sustainability, investing in electric vehicles is an effective way to achieve those goals.”

The full survey results, including breakdowns across business sizes and states, can be found here.

Image: https://www.wa.gov.au/service/environment/environment-information-services/electric-vehicle-ev-strategy

References:

[1] https://electricvehiclecouncil.com.au/wp-content/uploads/2023/07/State-of-EVs_July-2023_.pdf

[2] https://www.salesforce.com/resources/articles/retail-loyalty-programs/