Driving the future: How value retention rate shapes electric vehicle adoption

Abstract

The government has been promoting the adoption of electric vehicles (EVs) in recent decades. However, challenges still exist in encouraging widespread use of EVs, which may impact potential buyers. Aside from the well-known barriers related to purchasing, the rate at which the value of EVs is retained over time may also influence consumers’ decisions. This article presents a model based on cue utilization theory to understand how consumers respond to the value retention rate when considering purchasing an EV. The model also examines how perceived quality and two intrinsic cues - brand reputation and the frequency of new product releases - influence this response. The findings indicate that the value retention rate influences consumers’ assessments and purchase decisions, particularly when the intrinsic cues are absent or insufficient. These findings have implications for government policies, EV manufacturers’ promotion strategies, and operational management.