Factors Influencing Customer Buying Decision on Electric Cars

This report investigates the factors that influence the customers buying decision on electric cars. It covers the internal and external factors that affect the purchasing decision, such as driving range, charging infrastructure, and individual environmental awareness. The report uses qualitative methods for collecting data and focuses on Tesla as a case study. The research aims to identify the factors that have influenced the decision-making process of customers towards electric cars and determine the benefits that could be gained by Tesla by changing the buying decision of customers towards electric cars.

AN INVESTIGATION INTO THE FACTORS THAT
INFLUENCE THE CUSTOMERS BUYING
DECISION ON ELECTRIC CARS
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ABSTRACT
The main purpose of conducting the current study is to carry out detailed information
about the various factors that influence decision making process of customers towards buying
electric cars. This reports has taken out data which shows that why electric cars are more
beneficial for the environment in comparison of conventional vehicles. Electric cars have the
power to protect the environment as well as benefit the society. This report has used qualitative
methods for collecting data. This helps in carrying out in-depth insights about the impact of
electric cars over purchasing behaviour of customers. It has dependent upon secondary sources to
gather information such as books, newspapers, articles, publications, journals and many more.
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ACKNOWLEDGEMENT
I am grateful that I received an opportunity to conduct an investigation. Conducting a
research paper requires great knowledge and skill and my supervisor has shown this confidence
on me. I am thankful to my supervisor who has helped me in determining the right research topic
so that I can get ample information to meet pre-defined research aim, objectives and questions.
My professor and supervisor have checked my each draft copy so that chance of mistakes could
be avoided.
I am also thankful to my family, relative and friends who have shown their support by supporting
me emotionally. They have helped me to keep my confidence and work hard on my research
work.
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CHAPTER 1: THE INTRODUCTION
1.1 Background to the research
Customer buying behaviour acquaints with the move or choice made by clients prior to
buying a help or item (Amron, 2018). An association actually should give quality in their items
and administrations, utilize successful foundation of virtual entertainment, give alluring plan in
the item and numerous other. These are fundamental viewpoints that will be gainful for an
association in changing purchasing conduct of the clients.
There are likewise a few factors that have impacted the purchasing choice of clients
towards electronic vehicles. These elements incorporate individual, social, advertising, mental
and some more. Alongside this, changing purchasing conduct of the clients is significant and
critical for the organization since it helps them in further developing its business execution
(Aragoncillo and Orus, 2018). There are additionally different benefits that could be acquired by
an association for changing clients purchasing conduct. These are; assists in achievement of
upper hands, increment with numbering of clients and some more.
There are many factors that make customers in make their decision regarding the
purchase of electric cars instead of conventional car. It has been found that the driving range of
electric car influence customer by making various improvement which includes reduction in
charging time, effective performance as well as reduction in pollution. The increased range of
driving improves the utility of electric cars which makes purchasers to drive electric cars. In
simpler words customers are willing to purchase electric cars when they get high driving range
as well as utility function in daily utilisation of it.
EV are operated with low cost which is one of the major reason that futuristic approach
which is helpful for the industry to grow. Across the globe people are able to gain higher positive
edge in appropriate manner. The mobility of the EV are high in which electric cars are able to
manage cost ability of their customers so that in minimum cost people can manage their needs.
This is examined that Electric vehicles are low in maintenance as they just need minimum cost of
operation in which people are able to manage their needs within budget. The decision making
procedure is generally complicated for every purchaser because in this digital world they are
provided with overloaded information. As per the research conducted in the market it is
determined that female auto-mobile purchasers give more importance to features like
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affordability, efficiency and safety. On the other hand, male purchasers give more importance to
features, aesthetics and performance such as style and interiors. It is also identified that male
customers get more attracted towards electric cars.
1.2 Organisational background
Inside this study, Tesla is a chosen American electric vehicle and clean energy organization that
was established in 2003. The organization was settled in 13101 Tesla Road, Austin, Texas,
United States. Organization is popular for planning and assembling electric vehicles and battery
energy capacity (Dahiya and Gayatri, 2018). Tesla is having higher brand picture into the market
for their advancement into the items. In the ongoing time the organization is wanting to venture
into worldwide market and for this client purchasing conduct is broke down by the association so
that the can take wise choices
1.3 Significance of the research
Recent research is huge for the various partners that are clients, Tesla, understudies and a
specialist. For understudies, this exploration is significant for them by further developing their
comprehension in regards to the advantages that could be acquired Tesla by changing purchasing
choice of clients towards electric vehicles (Dakouan, Benabdelouahed and Anabir, 2019). For a
scientist, ebb and flow research is fundamental for them by further developing their exploration
abilities that are information assortment, using time effectively and direction and numerous
others. For Tesla, this exploration is fundamental for them by changing purchasing conduct of
the clients towards electronic vehicles that brought about better business execution
1.4 Statement of the purpose
Fundamental motivation behind directing this examination is to distinguishing the
variables that have affected on dynamic course of clients towards electric vehicles (Dhiman,
Chand and Gupta, 2018). Changing purchasing choice of client is fundamental and significant
for the organization since it helps them in achieving upper hands in a powerful alongside
effective way.
1.5 Statement of the problem
The major issue analysed within the current research is related with increasing
environment impact in the recent time. The carbon footprints and environmental wastage is
increasing in current time which is leading to minimise the usage of fossil fuel vehicles. This is
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analysed that the selling of electronic vehicles are gaining higher success in the current time and
for such businesses this is essential that to analyse customer behaviour so that overall edge can
be acquired. The customer journey is the essential aspect which is helping the business to grow
and in this manner the current research is based on understanding the factors which are
influencing customer’s buying decision for electric vehicles. There are certain problems which
are related with electric care manufacturing company and these are related with prices of the
product and maintenance cost of the product so that the current research report is related with
examining such issues along with their recommendations that can be used by the organisation to
manage their business operations.
1.6 Aim and objectives
Research aim: To investigate the factors influence on decision making process of customers
towards electric cars: A study on Tesla
Research Objectives: To increase basic understanding about the customer buying decision in context with
electric cars To identify the factors that have influenced on decision making process of customers
towards electric cars To determine the benefits that could be gained Tesla by changing buying decision of
customers towards electric cars To examine the challenges that Tesla could be faced while changing customer’s buying
decision towards electric cars
1.7 Research questions
 What is the conceptual framework of customer buying decision in context with electric
cars?
 What are the main factors that have influenced on decision making process of customers
towards electric cars?
 What are the benefits or advantages that Tesla could be gained by changing buying
decision of customers towards electric cars?
 What are the major challenges that could be faced by Tesla while changing customer’s
buying decision towards electric cars?
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1.8 Dissertation structure
There are a few sections that re helpful in finishing full thesis effectively and efficiently. These
sections alongside their significance in paper is made sense of underneath;
Section 1: Introduction: This is a first part of the paper that incorporates a few information with
respect to the point. These are hierarchical foundation, foundation to the exploration, meaning of
the issue, mission statement, point and goals, and examination questions. Every one of these are
fundamental data that helps an examiner in beginning different parts in a fruitful way.
Section 2: Literature review: This is one more part that assists an examiner in gathering
auxiliary data from accessible sources, for example, books, diaries, articles, distribution with
researching and numerous others (Eze and Bello, 2016). These are fundamental sources that will
helps a specialist in social occasion exact and top to bottom data with respect to the variables that
have impacted on dynamic course of clients towards electric vehicles.
Section 3: Research methodology: This is a significant part that works with an agent in
gathering precise data in regards to the point from different procedures. These are inductive
methodology, interpretivism reasoning, subjective exploration, efficient writing audit and some
more (Hakim and Almahdi, 2020). These are fundamental philosophies that will be applied for
social affair optional data about the advantages that could be acquired Tesla by changing
purchasing choice of clients towards electric vehicles.
Section 4: Data analysis and findings: This part is vital for the researcher since it helps them in
assessing accumulated data through research analytical techniques. Thematic examination will
be trailed by a investigator for assessing subjective information in less timeframe.
Section 5: Conclusion and suggestions: This is a last part that will be fundamental in
recognizing that examination point and goals are achieved or not. In proposals, a few fitting
ideas will be given to the Tesla about how to draw in and impact clients towards electronic
vehicles (Hanaysha, 2018).
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CHAPTER 2: LITERATURE REVIEW
2.1 Introduction
Literature review is the part that gathers optional data for tending to the examination
inquiries in a precise manner. This part utilizes auxiliary sources, for example, books, articles,
diaries, papers, distributions and so on. In less complex words, writing survey is an outline of the
prior distributed assembled information on a specific subject. Thusly, this covers top to bottom
data about the client purchasing choice comparable to electric vehicles. The principal motivation
behind writing survey is to figure out the flow research specifically field prior to focusing in on
doing the new exploration. By leading the Literature review, researcher can figure out what
exploration has proactively been finished and what is obscure inside subject.
2.2 What is the conceptual framework of customer buying decision in context with electric cars?
As per Asadi and et. al., (2021), electric vehicles has made vital changes in the auto-
portable market and its reception is prompting more modern plans of action. The worldwide
climate has additionally preferred electric vehicles and in this advanced time individuals are
becoming more focused on them. It is resolved that huge number of electric vehicles are selling
in various nations. The fundamental benefit that are helping in the system of getting
consideration of individuals is that electric vehicles work at lower cost. Many patterns have
additionally proposed that there will be consistent interest among the clients for electric bikes as
well as vehicles.
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Figure 1: Conceptual framework of customer buying decision
From the above mentioned graph, it has been determined that there are internal and
external factors that have influenced on customer buying behaviour towards electric cars. There
are various internal factors such as perception, memory, needs, motivation, attitudes,
demographics, lifestyle and personality. These are main internal factors that influence customers
towards electric cars. There are also some external factors such as culture, sub-culture, social
class, reference group, opinion leaders and family life cycle. Purchasing a vehicle is known as a
time-consuming procedure with several external and internal factors influencing the purchasing
decision (Singh, Singh and Vaibhav, 2020).
2.3 What are the main factors that have influenced on decision making process of customers
towards electric cars?
As indicated by Cui and et. al., (2021), ability of clients to purchase electric vehicles are
impacted by the variables known as financial plan imperatives, social convictions and utility
(individual inclinations). This incorporates the variables to consume electric vehicles according
to three critical points of view which are: convictions, requirements and utility. Under the utility
area, driving scope of electric vehicles is incorporated which is investigated. In regard of
imperatives, three elements are incorporated which are: government monetary motivating forces,
buy cost and charging foundation. This enormously impacts the eagerness of clients to buy or
embrace electric vehicles. As far as conviction, the apparent social impact and ecological
consciousness of people are considered as the examination factors.
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Driving range: The range of driving increments hold the greatest value which also
follows performance, pollution reduction and charging time. It shows that driving range is one of
the key aspects of electric car attribute and utility to impact willingness of purchaser to buy.
There are different conducted research which have highlighted that driving range is necessary
factor to influence the adoption of electric cars. Customers generally have particular expectations
in relation to driving range because the high mileage could decrease the charging time.
Charging infrastructure: The restriction of consumption could be from both public and
finance environments. The recent investigations show that large number of customers do not
only give importance to driving range but also want to drive or cover long distances. The long
distance driving of electric cars majorly depends upon charging infrastructure (Shalender and
Sharma, 2021). In simpler words, poor charging infrastructure is one of the major constraints for
driving and covering long distance. It is determined that developing advance charging
infrastructure could attract more customers to buy electric vehicles because it helps them to
cover longer driving distance. For potential customers, there are certain factors which they
consider before buying electric vehicles such as charge-point interoperability, charge-point
location, charge cost and the number of charging stations. The charging points are generally
installed at the positions such as outside of the office, outside of the home, highway service
stations and publicly accessible locations. Therefore, installing charging piles at different
locations helps customers to travel long-distance trips as well as business trips. In simpler words,
great establishment of charging infrastructure creates positive impact on shaping willingness of
customers to purchase electric cars.
Individual Environmental Awareness: Awareness regarding environment has given
certain confusion in environmental psychology investigation about the exact meaning of
environmental concern. Awareness regarding environment is linked with reference to individual
particular beliefs about or world views and general environmental beliefs. Environmental
awareness is known as the special belief and it is also linked with personal belief. Nowadays,
consumers are giving major importance to environmental protection and this also holds
importance in shaping buying decision of environment-friendly products. As per the studies
conducted earlier indicate that electric cars are eco-innovations that hold great potential in
reducing the environmental issues of the transportation sector. Electric car adopters express
protecting the environment as one of the motivation factors for choosing electric cars in
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comparison of conventional vehicles. Thus, the consumers are more focused on reducing the
negtauve impact from environment due to which it is important for company to reduce the
carbon emission by using renewable energy sources.
Purchase Cost: The other most important factor is budget because every customer does
not have excessive budget. So, it shows that customers have limited budget, so the relationship
between budget and advantage required to be fully considered before purchasing, certainly in the
present market for electric cars because these vehicles are more expensive than conventional
cars. It makes customers to purchase conventional cars because they are left with no choice when
they do not have big budget. The high prices of electric cars are generally because of expensive
battery pack and also due to the absence of economies of scale. It is stated that higher purchasing
cost is one of the significant barriers to electric cars sales in comparison of electric cars.
Financial factors are generally essential factor for customers when they make decision of buying
a new car. The electric cars generally have higher sticker prices as compared to their gasoline-
fuelled counterparts due to the expensive materials and processes which are used in battery
production.
Perceived social influence: Social influence is the main factor that effects the consumer
buying decision of the individuals and this makes them purchase the electric vehicle on a fast
pace. Social culture is considered as a system of shared beliefs, knowledge, procedures, artefacts
and attitudes that generally results in effecting the decision of consumer in the competitive
market. With the changing market trends, the buying behaviour of consumers towards
purchasing electric vehicles of Tesla has changed so that they also enjoy smooth driving
experience. It is important for the company to focus on customers of middle age because the
always want to try something new and will try to experience a new exposure in order to deal with
the changing culture. Social media influences the decisions of buying a particular product very
prominently as it attracts and forces them to try this new type of electric vehicle that generally
saves cost and life too.
Attitude and purchase intention of consumers: Consumers purchase intentions are
widely studied so that their changing needs and expectations can be addressed in an effective
manner. With the change in technology in today's modern world it is important for Tesla to adopt
change their perception regarding a particular thing and to buy and try new things so that they
get highly satisfied. The attitude of the consumer is positively related with the intention of
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purchasing an electric vehicle that is more suitable and helps in providing a smooth driving
experience. Electric cars the new trend that are easy to drive and is has a very good driving range
and this helps in targeting individuals ta the middle age as they are more keen of driving and
especially male gender who are more interested in taking a driving experience so it is important
for the company to focus on providing best service.
2.4 What are the benefits or advantages that Tesla could be gained by changing buying decision
of customers towards electric cars?
According to (Braunfels, 2021), Change is a part of everyone's life which helps in giving
maximum benefits to the society. One of the major transformation or change in the automotive
industry is the introduction of electronic vehicles which has changed the buying perspectives of
the individual. Electronic vehicles are more beneficial in the future as is more environment
friendly as compared to normal fuel vehicles. Petrol cars produce a large amount of carbon
emissions that affects the natural atmosphere and leads to more pollution and more greenhouse
gases. In order to reduce pollution and for increasing positive environment, most of the
companies are now focusing on manufacturing electronic cars. Electronic cars provide more
benefit to persons which helps them in receiving government subsidies for being relayed to
environment conscious. Electronic vehicles are costlier but are good for the environment as it
produces less pollution in the environment and is easier to drive. As the market for electric
vehicles is growing in a fast pace because it is more safe and have secured features. There are
many reasons why consumers are changing their perceptions to buy electric vehicles because of
new regulations related to vehicle emissions and safety, changing customer expectations and
technological advances. Tesla is more focused on delivering electric vehicles to change the
perceptions of consumer towards the purchase of electronic vehicles. The business model of
Tesla is based on a three branched approach such as selling, charging and servicing its electric
vehicles. The company wants that customers gets attracted towards buying electric vehicles
because it helps them in experiencing a best service by driving the car. There are several benefits
or advantages that Tesla gains by producing electronic cars which are defined below:
 Low cost of maintenance – The main reason of buying electronic vehicles is their low
cost of maintenance which attracts customers towards that product (Darlington, 2020). If
the customer buy a car having an IC engine which will consists of more mechanical parts
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and thus, creates more complexities and difficulty in managing their maintenance.
Electronic vehicles of Tesla are easy and are less costly to maintain because it has simple
structure and operations which are easily assessable by the person. This influence the
buying behaviour of the customer which attracts them in buying electronic vehicles
because of its low cost of maintenance. This has been examined that the electric cars are
low in maintenance which means that people are able to save their cost and money so that
to manage their vehicles.
 Electronic vehicles do not have sound of their own - Another advantage that an
electronic vehicles have over their normal existing car is their silent sound functioning
capability. As there is no engine under the bonnet of the car so it does not make any
noise. The electronic car produced by Tesla functions so silently that a person can work
and can also read a book inside the car while travelling. Because of the silent feature in
electronic vehicles helps in providing a comfortable ride and good experience which
helps in attracting more customers.
 Less running costs: Another advantage that electronic vehicles deliver over conventional
cars of IC engine is its running cost. Electronic vehicles of Tesla have generally low
running costs which is beneficial for the customer because normal engine car costs more
while travelling for a long journey. This is a major factor that influences the buying
behaviour of the customers to buy electronic vehicles because they use electricity to
charge themselves (Jena, 2020). EV's are less in running cost which means that these cars
will be managed in lesser running cost. This manner budget friendly solutions can be
acquired by individual when they are planning to buy some car so that to satisfy their
needs.
 Sustainable and clean environment – If any customer is planning to buy electronic
vehicle for their comfort then they are definitely contributing in attaining a sustainable
environment which is good for overall development. The earth has healed itself at the
time of complete lock-down because of reduced pollution and this forces the customer in
buying a environmental friendly vehicle that produces less pollution. Buying an
electronic vehicle helps in reducing he carbon footprint because the car do not produce
harmful emissions. The EV's are able to provide benefits to the environment in terms of
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economic and sustainable environment which means that clean environment can be
created which is beneficial for longer duration of time. In this manner overall
development of personal and sustainable economy can be created with in the car users.
 Comfortable cabin and more storage space – The electronic car not only have silent
cabin but also have a better space for legroom that helps customers in receiving more rest
(Rapson and Muehlegger, 2021). Tesla manufactures electronic vehicles to provide
customers to experience a comfortable ride and it also consist of more storage space the
front cabin because it do not have gear lever. This helps in changing the purchasing
decision because it offers a very comfortable and exciting ride to all the members. These
cars are new in trends which means that they will be providing such additional features
which would be helpful in attracting customers for longer duration of time. These cars are
made with larger boot space so that comfortable journey can be provided to the individual
riding the cars. This is one of the major feature which has developed buying behaviour of
individual in terms of positive purchasing decisions. As the cars are providing
comfortable space of driving which is one of the tempting feature for individual to make
their decisions.
 Electronic vehicles are beneficial for future – With the changing demand and
expectations of customers according to the new market trends has increased the need for
electronic vehicles. It is necessary for Tesla to attract and retain more customers ti buy
electric cars because it helps in reducing the pollution and are easy to drive and use and
also consists of more space. As fossil fuels are less and are about to end anytime and it is
not a good decision to exhaust the fossil fuels while living in this world. So use of
electronic vehicles is more beneficial as compared to normal vehicles and customer must
shift their preferences to buy these vehicles. Electric vehicles
 Easy and convenient charging at home – Electronic vehicles can be charged from
anywhere and can be charged at home easily by portable chargers which takes around 4
to 5 hours (Thomas and Maine, 2019). Normal fuel stations has a very long queue during
peak hours and this makes the person sometimes late for reaching their workplace. Tesla
electronic vehicles offer customers this benefit to make them comfortable while charging
and moving to any place.
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Thus, electronic vehicles are the future for upcoming generation and are good for maintaining
the sustainable environment. The impact of manufacturing electronic vehicles is zero as it helps
in reducing carbon footprint and affect the economy positively which leads to more growth and
productivity of the company.
2.5 What are the major challenges that could be faced by Tesla while changing customer’s
buying decision towards electric cars?
According to the opinion of Targonya, Khmeluk and Bankovskaya (2019), there are various
challenges which are faced by organisation while changing the customer’s buying decision
towards the electric cars. These challenges can influence the performance and productivity of
Tesla within market. Nowadays, electric car is becoming popular due to which its demand is also
increasing rapidly. The electric cars are going to introduce critical changes in automobile
industry which results in more futuristic business model. Across the globe, the sale of electric
cars is impressive due to which Tesla is focusing on entering into new market in order to
improve the business performance and profitability. According to the consumer survey, it is
being analysed that customer face various issues related to electric cars. It becomes challenging
for Tesla to change the customer buying behaviour towards the electric cars.
The few problems which are faced by consumers with electric cars are noises and leaks,
climate system, drive system, power equipment, paint and trim, charging stations and body
hardware. These factors influence the consumer buying behaviour as they generally buy the
product by comparing the price and quality of products. The price of electric cars which Tesla is
offering is too expensive. The price factor is one of the reasons for changing the buyer’s
behaviour. Electric cars are more expensive as compare to petrol and diesel cars. The cost of the
electric cars can be reduced in long run due to lower fuel, maintenance cost and servicing. For
improving the sale of electric cars, it is necessary to focus on reducing the price of its models in
order to attract more and more people towards the brand. There are various customers of electric
cars who charge their cars at home in their garage by using special wall mounted charger. Tesla
must focus on improving the experience of customers as the owners of electric cars experiences
the range of anxiety due to run out of power before reaching to charging stations. The drivers
have fear that their battery will run out before reaching to the destination. For influencing the
behaviour of consumers, range and charging availability plays an important role. Another issue
which can be faced by organistaion for influencing the consumer buying behaviour is handling
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the chip shortage. For holding back deliveries of electric cars, company is facing chip shortages.
The electric cars makers have increased their production after COVID 19 due to which chip
makers struggled to address their demand. Thus, it is essential for Tesla to fulfil the demand of
consumers related to availability of electric cars in order to make them satisfied. It becomes
challenging for car driver to learn the functions of electric car in order to drive it in smooth and
effective manner (Bozhuk and Pletneva, 2017). They also face issue related to the battery cost, as
the battery of electric cars resist up to 8 years after the battery decay period customers have to
buy newer batter which is costly for them. Battery cost is also a factor which influences the
purchase decision of customers. Therefore, it is one of the pressing issues for owner of EV so it
is important for Tesla to overcome these issues in order to attract and retain their customers
towards the brand. Consumers also face problems related to cost of charging at home as the
person who lives in apartments face difficult to charge their electric cars. The parking garages
are rarely equipped with charging stations and for installing the charging station in costly for
building managers. They also face additional problems of electric costs which are incurred at
common outlets. The regulars electric vehicles charging consumers more energy due to which it
becomes necessary for building manager to monitor EV charging in order to ensure that drivers
of electric cars pays their own electricity usage. Therefore, these problems influences the buying
behaviour of consumers related to electric cars. The electric vehicle companies have their own
charging port which becomes one of the problem for setting up proper charging ecosystem. The
consumers of electric vehicles face difficulty for charging their vehicles from different EV
making company’s stations which can influence the growth of Tesla. The lack of standardisation
can influence the growth of Tesla. It is important for company to focus on increasing its charging
points in order to make their consumers feel satisfied and reduce their pressure for charging their
electric vehicle from anywhere without using the charging point of other companies.
The reason which influences the consumer behaviour regarding the purchase of electric car
is temperature issue. It can influence the performance of EV battery at large extent which makes
electric vehicle inappropriate for too hot regions or too cold regions. The battery of electric
vehicle can give their ideal performance when it is use under the temperature of 15-40 degrees.
Environmental concern is another reason which creates an impact on the decision of buyers
while buying electric cars (Rotaris, Giansoldati and Scorrano, 2021). The EV revolution is
necessary for most polluted and populated parts of countries. In few cities, the chunk of
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electricity is generated from burning fossil fuels which spread pollution through ICE vehicle
smoke and also the most of the charging stations in few countries are operating upon diesel-
driven electricity generator. Thus, for reducing the emission problem it is important to use
renewable energy sources. Environmental concern is top priority for consumers as they don’t
want to create negative impact on environment. Therefore, Tesla must focus on reducing the
negative environmental effect as it can influence their brand image and reputation in market.
Hence, these are the few challenges which may be faced by Tesla in order to attract and retain
their loyal customers towards the brand (Hubka, 2019). It becomes important for the company to
satisfy the need and demand of customers in order to influence their buying decision towards the
electric cars.
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CHAPTER 3: RESEARCH METHODOLOGY
3.1 Introduction
Research methodology is regarded as the methods and techniques which are used within
the research in order to identify significant aspects so that to execute the process of determining,
selecting and analysing data of chosen research topic (Snyder, 2019). The chapter of
methodology assist the investigator in evaluating the data with reliability and validity. This
chapter defines the manner in which the information can be gathered and generated in analytical
manner. Research methodology elaborates clear justification and some of the research
methodologies are elaborated as under:
Research Philosophy:
Research philosophy is considered as the set of beliefs which are used within the research
so that to align with nature of reality. This is the definition of knowledge's nature and using
research methodologies research can be managed in more appropriate manner along with
attaining their goals and objectives. In basic terms this can be said that the research philosophy is
accumulation of values and principles that are used within managing the study in concerned
manner. Research philosophy is divided three types such as ontology, epistemology and
anxiology. Ontology is related with describing the nature of reality in which investigation which
relates the research with surroundings and society (Mohajan, 2018). Epistemology is considered
as scientific method which helps in solving all the issues without any issues. Ontology research
philosophy is related with classifying and explanation so that set of examination can be made. In
this research epistemology research philosophy is used. Epistemology is further divided into
interpretivism, realism and positivism. Under this interpretivism research philosophy is used so
that non numeric information can be added in less time and cost.
3.2 Research Approach
Research approach is considered as one of the major dimension of research onion which
is having great degree of importance. In other words this can be said that research approach is
accumulation of such plans and processes which are used within the research so that to offer
detailed description and to manage accordingly so that research objectives can be attained. This
is the method which helps in managing pre-defined objectives in such manner that appropriate
decisions can be made and at the same time research can be managed in effective and efficient
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manner. Using appropriate research approach research decisions can be taken so that most
suitable plans can be made to attain research objectives (Pandey and Pandey, 2021). There are
three types of research approach such as deductive, abductee and inductive. These are the
methods which play important role in managing pre-defined objectively in prominent manner.
Deductive approach is associated with evaluating information in a manner that quantitative
methodology can be adopted. On the other hand, adductive approach is related with using mixed
methods such as qualitative and quantitative. Inductive approach is related with qualitative
methods in which research can be exerted in in-depth manner. For the current research, the
researcher has used qualitative research methods so that for aligning the same inductive approach
is selected. This assists the researcher in managing the research in systematic manner along with
attaining research objectives in depth manner. In this approach new theories are being made after
collecting and analysing the data.
3.3 Research Strategy
Research strategy is the process which helps the researcher to maintain their focus over
research work. The research strategy is associated with taking out authentic and appropriate data
within the research so that in systematic manner the research can be exerted. Research strategy is
classified into different types such as case study, experimental, survey, grounded theory and
many others (Newman and Gough, 2020). By undertaking the requirement of the current
research this is analysed that as inductive approach is undertaken so that systematic literature
research strategy is taken. This is one of the economic method which is reliable in nature and
would assist in attaining research objectives. This is the strategy which helps in collecting the
information in deeper manner in which targets of the dissertation can be attained. Hence this
research strategy is one of the efficient method which helps in developing capabilities of the
research and in convenient manner research can be managed and the overall research can be
done in appropriate manner.
3.4 Research Choice
Research choice is regarded as one of the major research methodologies which helps the
research to manage collection of information. Research choice is of two types such as qualitative
and quantitative. Research choice is having major impact over attaining research objectives in
which overall methods are adopted within the research (Rinjit, 2020). Quantitative research
choice assists in managing the information collection process in statistical manner so that
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numerical outcomes can be taken out whereas qualitative research choice is related with
managing the research in depth manner so that clear examination on research topic can be
exerted. In the current research, qualitative research choice is used so that non numerical results
can be taken within the research. By using this method data can be extracted in words and text
which aids in attaining the objective in deeper way. Qualitative method is on of the cost effective
method as data can be acquired easily and also in flexible manner.
3.5 Data Collection
Data collection is the process which is referred as the process of measuring, analysing
information using different techniques. Using different techniques investigator may acquire
information and use the same to attain research objectives. Data collection is divided into two
parts such as primary and secondary data collection. According to the need of the current
research, primary and secondary data collection method is used. Primary information is gathered
by using direct source such as respondent and taking their views (Ngozwana, 2018). Whereas
secondary data collection is associated with collecting information using already published
articles and journals. Primary data collection methods are authentic and reliable in nature
whereas secondary data collection methods are helpful in saving time. In the current research,
secondary data collection methods is used so that research can be executed in proper manner. In
terms of secondary data collection method books and journals are used so that accurate
information can be gathered related with research topic.
3.6 Research Design
Research design is the framework which is related with methods and techniques related with
research topic so that process of collection and evaluation can be made. There are three types of
research design such as descriptive, experimental and exploratory. Descriptive research design is
related with one of the common stage of research design in which motive of managing the
research in quantitative manner can be met (Bairagi and Munot, 2019). Exploratory research is
related with identifying research issue and accumulating studies in it so that overall results can
be ascertained. Experimental research design is related with justifying situation in which
participants are allocated in different groups. In the current research exploratory research design
is selected so that in systematic manner research can be executed.
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3.7 Time Horizon
Time horizon is defined as such methods in which time is given to the researcher for
executing the whole research (Dodds and Hess, 2020). There are two types of time horizon such
as cross-sectional and longitudinal. In the current research cross-sectional time horizon is used so
that dissertation can be managed in appropriate time. This time horizon is associated with
managing different activities at a single time slot in which research efficiency can be developed.
3.8 Reliability and validity
Reliability and validity are two major constraints within research which helps the
researcher to manage overall research in transparency and correct manner. In terms of reliability
using thematic analysis reliable data is collected and to attain valid information, authentic site is
being used so that accurate data can be accumulated.(Abutabenjeh and Jaradat, 2018).
3.9 Research ethics
Research ethics are defined as such ethical part which is added into the research so that to
carry out the research in ethical manner and to manage reliability within the research (Babii,
2020). Under the current research different ethical considerations are managed such as informed
consent is obtained from participants so that they feel free to provide their views. On the other
hand, confidentiality is also maintained within the research so that respondents do not hesitate to
take part in the research.
3.10 Limitation of the research
The major limitation within the research is time constraint and resources. In order to
carry out the research in appropriate manner time is needed but due to shortage of time
researcher was not able to manage prominence of the research (Melnikovas, 2018).
3.11 Chapter summary
From the above chapter this can be concluded that under the research qualitative research
methods are used so that in-depth manner research can be executed and overall conclusion can
be taken out.
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CHAPTER 4: DISCUSSION
4.1 Theme 1: Conceptual framework of customer buying decision in electric cars:
From the above literature review it is being discussed that there is being a huge change
that is being occurred in the automotive industry with the development of electric cars. The
concept of electric cars has changes the overall business model and is one of the great
innovations for the future. It is being observe that in many countries large amount of electric
cars are being sale, the main reason for grabbing the viewer attention towards the electric are is
lower cost. To maintain electric are requires low cost and maintenance which help the middle
class people to afford the concept of electric vehicle. In some of the market trends it is being
observed that there will be more interest of customer towards the electric two wheelers as well as
cars. From the above secondary data it is also being discussed that there are two determinants
which are internal and external factor that influences the buying behaviour of the customers
towards the cars. There are some external factors as well which influences customer which is as
follow: culture, family, society, status and class, reference group, life style and many more.
Infact it is also noticed that customer also give priority to the feature, model, aesthetics, miles
while purchasing the car. Personal belief of customer is also important in order to make their
rational consumption choice for purchasing electric car. As these aspects of electric vehicles
utility and attribute that affects the willingness of customers in order to make their purchase
decision regarding it. In electric car, customers are mostly worried about that it does not cover
the long distances (Danielis and Scorrano, 2020). The charging infrastructure of electric car is
not effective it does not cover long distance. Now, the companies are focusing on developing the
charging infrastructure of electric car so it easily covers long distances. This will help in
attracting the more customers towards it. It has been found that the customers are more limited
by the budget for the purchase of electric car. Consumer considered the cost and benefits while
making their purchase decision for electric car. In current market, the electric cars are costlier
than conventional cars. This makes companies to focus on reducing the cost of electric car which
helps customers to purchase them and helps in reducing the pollution in the country. The
government of country will also help them to reduce the cost of purchases by providing financial
incentives in order to encourage customers to purchase electric cars. In many countries,
government incentives helps in increasing the use of electric cars which makes important for the
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government to provide support in increase the use of electric cars in the country which also
provides various environmental benefits. Environmental awareness also helps in making the
customers more aware and concerned towards the environment of the country that influence
them to purchase electric cars instead of conventional cars in order to support in protection of
environment.
4.2 Theme 2: Factors influences decision making process of customer towards the electric cars
With the accumulated information from various secondary sources it is being discussed that
the willingness of the buyers to purchase electric cars depends upon the budget, cultural values
and utility. Under the factor of utility driving range of the car is included, with the respect of
Constraint the factor which is included are government financial incentives, buying cost,
charging infrastructure. At last under the belief factors which are there is social influences and
environmental awareness.
In the driving factor the range of driving holds important part in customer decision
making. In this pollution rate and the charging time is being of great value. In various researches
it is being investigated that in automotive industry when a buyers buy a car they look for the
range and then make any purchase decision. The increase range of driving enhances the utility of
the car. Another element that is charging infrastructure also affects the buyers’ decision.
Customer wants those cars which cover a long distance without the need to charge it in shorter
time. Thus the grater establishment of charging creates positive impact in the mind of buyers.
Other factor is individual environmental awareness, it is directly linked with the though and
belief a person see about their world. It is also linked with the personal belief of the consumer
because in recent time buyers are more focused about protecting the environment. This makes
company to make reduction in the cost of electric cars so, their target customers are not move
towards the purchase the conventional cars as they does not affords to purchase electric cars.
When the cost of purchase of electric car is decrease it automatically increases the sale of electric
cars. In today’s time customers wants to purchase those products that are more innovative and
creative and can easily be purchase in low cost in order to become more trending and fashionable
(Kwon, Son and Jang, 2018). The design and features of electric cars is more innovative and
attractive and it can easily be attracted by the people in order to make their purchasing decision.
But the higher cost of them affects the decision of customers to purchase electric cars instead of
conventional cars. The government also need to provide information or awareness about the
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environment to the people of the country so, they make their decision to purchase the electric
cars as it helps in protecting the environment of country. This will helps in making people more
concerned towards the environment and have knowledge regarding the use of electric cars in
protecting the environment. This will also help in making the decision of customers for the
purchase of electric cars.
4.3 Theme 3: Benefits that Tesla could be gained by changing buying decision of customers
towards electric cars
From the above gathered data it is being discussed that the major change in the automotive
industry by the Tesla has provided various benefits to the company. The development of electric
car by the company has changed the way Tesla works before. Some of the advantages that
company acquires are as follow:
Low cost of maintenance: The foremost advantage to but the electric car is it requires low
cost which attracts many new buyers for the product. The electric cars of Tesla require low cost
and maintain the care is also easy because the vehicle is being run by the battery. Simple
structure and operation of electric cars made it possible for the person to use the cars. Thus this
influence the attitude and perception of the buyers towards the brand.
Silent sound of the vehicle: Another major benefit that can be gained by using the Electric
car is of silent sound functioning. The vehicle has the capability of silent functioning which does
not create any noise in the environment. Tesla developed the car in such a manner that a person
who is inside the car can read the book as well as can do any other activity. An individual can
experience a comfortable and cozy ride which helps the Tesla to attract many buyers towards the
company’s product.
Less running cost: One of the major advantages of the electronic vehicle is less cost to run
the cars. Using IC engine need more money but the electric vehicle run by the battery which
need less cost. Normal cars need petrol and diesel to run the cars but this is not with the electric
vehicle of Tesla. The cars can covers long distance which help the rider to enjoy their ride.
Sustainable and clean environment: Another major reason to use the electric vehicle is
sustainability. The cars can be used for longer time due to the factor is sustainability. It can fulfil
the current need as well as future need to. Not only this but using electric car is environmental
friendly which means it protect the nature. They produce less carbon footprint which helps in
reducing air pollution.
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More charging stations- These are also important for the proper use of electrics cars in
order to influence customers to purchase electrics cars or vehicle instead of conventional ones.
Many people forget to charge their cars before going for long distances, due to low battery that
cannot reach to their final destination which also affects the customers to think before making
their purchase decision for the purchase of electric cars (Pradeep, Amshala and Kadali, 2021).
If there are many charging station in the country helps customers to charge their vehicle when it
have low charging. This will help consumer to make their decision for the purchase of electric
cars.
Attractive and creative design – The design of electric cars of Tesla is to attractive and
creative which can easily grab attention of many people. This will also help in making customer
to purchase electric cars. Many peoples want to purchase innovative and creative design in order
to become more trending in the society. This will helps in influencing the customers to make
their purchase decision for electric cars (Hardman and Tal, 2021).
No fuel required- The other benefits that the company is providing to their customers for the
purchase of electric cars is they do not need any kind of fuel for its use. This will help in saving
the fuel in the country in order to safe natural resources for the use of other important purpose.
The price of fuel is constantly increasing in the country which makes customers to purchase
electric cars in order to make saving that may affects due to consumption of fuel in higher prices
in the country.
4.4 Theme 4: Major challenges that could be faced by Tesla while changing customer’s buying
decision towards electric cars
From the above literature review it is being discussed that Tesla has faced many
challenges while turning the perception of the buyers towards electric cars. This challenges
impact the performance and productivity of the company in the market. The foremost challenge
is producing the cars by keeping in mind the cost and budget of the consumer.Another challenge
is adopting those marketing strategy which is help them to advertise and promote their electric
car to larger audience. For this they need to hire expertise which can promote the goods in
innovative and creative way. This will helps in grabbing the attention of more customers for the
purchase of electric cars in effective manner (Habich-Sobiegalla, Kostka and Anzinger, 2019).
The company can also make collaboration with social media influencers in order to attract the
customers to purchase electric cars. When the customer sees that the person that they are
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following is using electric cars they can also get influenced to use them which helps in increasing
the sales of electric cars. The company is also facing difficulties in order to influence customer
for purchase of electric cars when they believe that it does not covers long distance. They think
that the charging capacity or the battery life time of electric vehicles us too weak due to which
they cannot make their buying decision. This makes company to improve their charging
infrastructure in order to make electric cars other vehicles more effective in order to long
distance with single charging. Tesla needs to adopt those strategies which can change their
perception and thoughts. For this they need to various analyses which become problematic. One
of the reasons which change the buyers’ behaviour is the high cost as compared to the middle
class people. The middle class buyers feel that Tesla is charging more cost and for them it is
difficult to buy the cars because of the limited budget they have. One of the major challenges is
to change the business model and decide which business model will be best so that they can
change the buyer’s decision making. Changing the business model means transferring the whole
functioning of the business this requires more cost and time.
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CHAPTER 5: CONCLUSION AND RECOMMENDATION
5.1 Conclusion
From the above gathered data it is being concluded that electric cars is gaining more
attraction by the consumer. They have changed the way how automobile industry works in the
past period. The adoption of electric car is one of the leading futuristic business models for the
automobile industry. The global environment of the world also likes the concept of electric cars
because it creates less carbon footprints in the society. There are many advantages that is gained
by the buyers which also change the perception of consumer buying decision towards the
company. There are two factors which influence the decision of the buyers which are internal
and external factor. it is also being concluded that different factors are their which influence the
decision making process of the customer some of them are driving range, charging infrastructure
of the company, environmental awareness and purchase cost.
These all factor is very vital for the buyers to make any purchase decision. With the
adoption of the Electric cars, different advantage are being gained by the brand some are low
maintenance cost, silent sound function, low cost for running, nature friendly and many more.
The electronic vehicles are so silent that the manufacturers needs to add a noisy sound in order to
protect the customers from pedestrians. As electric vehicle do not have their own sound which
means that they are not producing any type of noise in which overall environment benefit can
also be attained. In this manner electric vehicles are better for the environment which is helpful
for managing environment sustainability.
The society and the global environment have also favoured the concept of electric vehicle
because it will reduce the carbon foot print in the society. In the current age people are also
getting serious for the use of electric vehicle and in large amount people are shifting their focus
from oil cars to battery cars. Some of the internal factors are perception, motivation, needs,
attitude, demographical elements, personality and many more. These factor is directly associated
with the customer behaviour which impact their decision of buying. The attitude and perception
of customers makes them to purchase the electric car whether it is costly or not which make their
buying decision for the purchase of electric cars. If there are many famous people in the country
using electric car in the industry which also influence the buying behaviour of customers. In
today’s time, many people are using social media and follows top personality which also affects
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the buying behaviour of customers to purchase electrics cars when they see their following
people are also using them (Seebauer, 2018). This makes company to make partnership with the
top influencer of social media to promote their electric cars in social media channels which helps
in encouraging the customers in order to purchase their electric cars.One of the vital factors in
customer decision making process is purchase cost of the car.
While making a buying decision buyers first look out for their budget. So if the cars come
under their pre decide budget than this will impact their decision making. Financial factor is one
of the crucial factors for the buyers because they have limited budget for the product and under
which they make all their buying decision.
The government of country also need to support and help in decreasing the cost pf
electric cars as it helps in reducing the pollution in country as well as save natural resources of
the country by providing financial incentives. The buying perception of the Customers has
changed with the innovation of electric cars by the brands. Their innovation has attractive many
buyers towards the company and has also built a strong market image of the brand. With the help
of this company can also gain competitive advantages in order to become more competitive for
their competitors. Many people are concerning about the charging of the electric cars as slow
charging and short distances running are affecting the buying decision of customers in order to
purchase electric cars instead of electric cars. This makes company to improve their charging
which helps in covering long distances with single charge. This help in increasing the range of
battery like of electric cars in order to help customers to drive the car for long distances. This
will also help in attracting customers in order to purchase electric cars. This will also help in
providing the contribution in the protection of environment of the country.
5.2 Recommendation
 For Tesla it is important to understand the buying decision of consumers in order to
improve the profitability and sale of business. Thus, by understanding the consumer
buyer behaviour, company can identify the expectation of consumers with the product.
 For influencing the consumer buying behaviour, it is important for Tesla to produce low
budget electric cars by leasing the car’s battery rather than having it included in upfront
price. Thus, the price factor is one of the challenges which can be faced by Tesla while
changing the consumer buying decision towards the electric cars.
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 Tesla may face issues related to the availability of charging infrastructure as they have to
expand their charging infrastructure to make long distance trips through electric cars. In
order to satisfy the customers, it is essential for Tesla to expand their charging stations to
multiple stops for charging.
 The consumers are also concerned related to battery fire risk within electric cars. Thus,
Tesla must focus on reducing the battery fire risk and ensures the safety of battery
technology. Customers also face difficult to learn the features for driving the electric car.
 Tesla needs to use those product which can be helps them to gain the advantage of low
cost from that of normal IC cars. If the price of the electric cars is decreases low income
group of people are also attracted for the purchase of electric cars as it helps in reduce the
fuel consumption.
 It has been found that many customers are using social media for making their
entertainment and purchasing which makes company to use social media platform for the
market of electric cars in all over the world. This will helps in improving the performance
of vehicles in order to attract more customer for its purchases. In various surveys it is
being analysed that customers are facing various challenges for making decision
regarding electric cars which are noise, environmental friendly, driving range, cost and
many more.
 The company may also launch different schemes to attract customers so that their buying
decision can be changed and at the same time significant edge can be acquired by the
organisation.
 Tesla is one of the multinational organisation which is having their existence in multiple
nations so that in the current time the company is making significant efforts so that to
manage their global identity so that in order to manage the same the company is needed
to study market needs of different nations so that easy expansion can be made.
 EV are considered as one of the major trend in automobile industry for the current time
so that Tesla should provide different trends into their product so that competitive edge
can be attained and at the same time customer can be attracted and retained.
 The price of the electric cars is much higher as compare to diesel and petrol cars. Due to
which it becomes challenging for consumers to purchase the electric cars and manage
their maintenance cost. Thus, it is important for Tesla to reduce the price of its electric
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cars in order to influence the purchase decision of consumers and make it affordable at
point of purchase to compete with gasoline powered cars. The price factor also creates an
impact on the purchasing decision of consumers while buying electric cars.
 The other factor which influences the buying behaviour of consumers is not enough
chargers point. Customers have perception that there are few battery charges are installed
due to which it becomes difficult to charge their battery cars on road. Therefore, it is
necessary for Tesla to increase their installation for public charging infrastructure in order
to make their consumers satisfied and relaxed while travelling through electric cars
(Dimitropoulos and et. al., 2016).
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