Norway Can Do It, Can Taiwan?
Norway has succeeded in making electric vehicles mainstream due to enticing government subsidies. This is in stark contrast to the limited incentives offered by the Taiwanese government. This discrepancy can explain why market reactions to electric vehicles are so drastically different in the two countries.
Christina Bu said in the closing remark of her TED talk that if Norway can do it, then any country in the world should be able to do it. Her talk highlights the fact that Norway managed to make electric vehicles mainstream despite its challenging environmental and climate conditions. Other regions in the world should have no excuses when it comes to the widespread adoption of electric vehicles.
In Norway’s case, the primary reason consumers have rapidly adopted electric vehicles is strong support from the government. Based on the Diffusion of Innovation theory, when an innovative product or idea is a commodity, the diffusion of innovation is related to an individual’s economic conditions. By offering tax exemptions and increasing the costs of owning fossil fuel vehicles, the Norwegian government has attracted potential consumers with economic incentives. Most consumers are highly sensitive to price and costs, especially for high-value products like cars. Government subsidies are the main reason electric vehicles have achieved a high market share in Norway.
John O’Nolan)
The situation in Taiwan is different. While the government does offer incentives, the level of support is still significantly lower than that of the Norwegian government. Besides, Taiwanese consumers are relatively unfamiliar with electric vehicles as an innovative product.
The gap between the Taiwanese market and the Norwegian one is quite substantial. The most reasonable explanation for this phenomenon is price. The high prices of electric vehicles limit the number of people willing to purchase them. Even if all early adopters switch to electric cars, their high prices may still deter the majority of consumers. This means that 85% of consumers, as depicted in the model, remain reluctant to adopt electric vehicles due to their high prices.
85% of consumers remain reluctant to adopt electric vehicles due to their high prices.
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