Silicon Valley Electric Vehicle Opportunity Initiative

Transcription

1 Silicon Valley Electric Vehicle Opportunity Initiative Employer Engagement Status and Summary Report January 28, 2014 Prepared by BW Research Partnership and the Economic Advancement Research Institute (EARI) 1

2 Introduction and Summary The NOVA Workforce Investment Board (NOVA) is a grantee under the Regional Clusters of Opportunity Grant, with a focus on its region s electric vehicle industry. NOVA has partnered on the grant with the Bay Area Climate Collaborative (BACC) as its subject matter expert, and commissioned BW Research Partnership to facilitate employer engagement. This engagement included a survey of employers and participation in a roundtable event event organized by BACC and held at Google, Inc. campus. This report is a summary of the feedback gathered from these leaders. The Findings: Overall, firms are optimistic for future hiring, and while they see difficulties, those challenges should not significantly impact their ability to hire. Finding the right mix of education, experience, and attitude remain somewhat difficult, and employers believe that internships provide the best mechanism for preparing the workers that they need. From a policy perspective, firms are most interested in tax rebates and other direct consumer benefits, as well as expanded charging infrastructure. Most believe that a mix of other incentives that are limited to drivers of electric vehicles (both original equipment manufactured and retrofits), termed treats are huge enticements. One very popular example of this is the HOV sticker program. Firms are also highly focused on charging infrastructure, recognizing the need for expanded charging at homes, residences, and public places. Incentivizing panel upgrades for multifamily and office building owners could yield much needed expansion of charging stations for relatively low cost. Perhaps most importantly, electric vehicle companies view NOVA and BACC as valued partners. The feedback gathered was useful, and the participants expressed excitement for continued engagement. By focusing on the needs of the companies, deeper relationships have been built that should serve NOVA and BACC well throughout the entire process. 2

3 Participants NOVA and BACC identified 103 individuals from organizations that are part of the electric vehicle and charging station value chains. These 103 contacts were administered a web survey to determine the breakdown of activities and to better understand the market forces, policies and regulations, and workforce dynamics that are affecting the firms ability to grow. Following the survey, participants were invited to a roundtable discussion on January 14, 2014, event organized by BACC and held at Google, Inc. campus, where participants explored survey results, answered new live poll questions, and discussed and explained pressing issues facing their industry. Forty-six (n=46) firms completed surveys from all across the value chain, with the largest segment focused on research, development and engineering, followed by software/it, sales, and manufacturing. Consulting services also play an important role in this cluster, and as seen in Figure 1 below, many firms report conducting overlapping activities (as a result, the sum > 100%). Figure 1: Respondent Profile Value-Chain Activity Research, Development, or Engineering Software or other Information and Communications Technologies Sales (Retail and Wholesale) Manufacturing or Assembly Consulting Services Automotive Repair and Maintenance Distribution and Logistics Financial Services Other 39% 39% 39% 32% 18% 11% 3% 34% 58% 0% 20% 40% 60% 80% Firms were also asked to provide information about their primary focus in the sector. Figure 1 illustrates that most firms work directly with electric vehicles and components (61%), followed by charging stations (47%), fleet management (24%), facilities or building management (13%), or something other activity (various consulting activities made up the bulk of these other respondents). 3

4 Figure 1: Survey Respondent Profile Cluster Focus Electric Vehicles and Components 61% Charging Stations 47% Fleet Management 24% Facilities or Business Management 13% Other 29% 0% 20% 40% 60% 80% Similar to the poll, the live event attracted participants from throughout the cluster, as seen in Figure 3 below. Figure 3: Participant Profile Cluster Focus 4

5 Impacts to Growth Survey respondents and event participants alike were asked questions about the impacts to their growth. In the survey, respondents were asked to select up to three issues that were most closely connected to their overall business growth. Consumer demand was reported by half of all firms, closely followed by consumer incentive programs (34% and also linked to demand), state regulatory challenges (29%), and the number of electric vehicle charging stations available (26%) (Figure 4). Figure 4: Impacts to Growth Survey Consumer demand for electric vehicles 50% Consumer incentive programs State regulatory challenges Number of available electric vehicle charging stations 29% 26% 34% Local regulatory challenges Federal regulatory challenges Consumer awareness of electric vehicles Government investment in electric vehicle charging infrastructure Vehicle pricing Cost of doing business Access to educated and skilled workers Proximity to suppliers and vendors Other 18% 16% 16% 16% 13% 11% 11% 3% 24% 0% 20% 40% 60% 80% To follow on the thread of consumer demand, event participants were asked how heavily is consumer demand impacted by policies and incentives targeted to electric vehicles? Not surprisingly, two in three respondents believe they are very important, while another one in six said they are somewhat important. This question was quickly followed by a query about which types of policies and incentives are best for growing consumer demand. Participants generally agreed that tax incentives and direct subsidies were important, as well as access to charging stations, but the exercise prompted a more detailed discussion regarding other, less obvious incentives. These incentives were called treats by the participants and refer to extra benefits offered to drivers of electric vehicles. 5

6 One of these treats is the HOV sticker program for EV drivers, which gives them access to HOV lanes. One respondent explained: You need tax credits, incentives from CEC, and help consumers get a special treat when they purchase. That would include HOV lane access. The resale premium of a used Prius with a yellow sticker was $5,000 more than a Prius without the sticker. We need to give people (with EVs) special driving privileges. We are reaching our cap of white stickers. The HOV stickers are cheap. They cost the state very little Additional suggestions included: Free municipal parking Free charging at municipal lots Free chargers in private lots (subsidized by state/local government) Better charging rates for cars with telematics (onboard software and communications) CEC-provided, fully-loaded charging cards for new car purchasers Expand benefits to conversions as well as OEM electric vehicles Survey respondents were also asked about their network of vendors and suppliers. Nearly two-thirds of respondents reported that their vendors and suppliers are local to the Bay Area, and 83% reported that this was somewhat (33%) or very important (50%) to their company s ability to grow. Most frequently, these firms were either charging infrastructure firms, machinists, or materials firms. 6

7 Charging Stations Following on the general discussion regarding consumer demand, event participants were asked about their feelings regarding the role of government in building infrastructure and investing in charging stations. Most believe government should play a role, with a few important caveats. According to one speaker who had reservations about government involvement, the most successful charging program is run by Tesla. Tesla [realized] that to sell the cars, you need infrastructure [so they] make charging free. Other participants noted that there are big differences between federal, state, and local government activities related to charging, and that the most successful ones have been through municipalities. Specifically, it was noted that the vast majority of charging occurs in two places; home and work. As a result, it was suggested that perhaps the focus of government investment is disproportionately applied to fast-charging infrastructure when in reality that makes up a small part of the charging needs of consumers. To this end, one commenter noted that financing incentives to upgrade panels of apartments and other multifamily units and office buildings could produce important results. This sentiment was echoed by participants who noted that there are many instances of failed infrastructure for alternative fuel vehicles and that the general public has little patience for such initiatives. It was noted that the most successful charging company, ChargePoint, received the least amount of government funding. While respondents understand the if you build it, they will come and potential chicken and egg conundrum regarding infrastructure and vehicle sales, respondents generally agreed that there is a fear that the eggs will end up in the wrong places with too much government intervention and that market competition would be better in terms of developing a coherent charging infrastructure that is based on demand. Participants discussed certain areas where government can play a critical role in charging infrastructure. The first concrete recommendation provided is to open access to charging to more people by facilitating agreements between utilities and multi-family unit owners. The second recommendation was for the California Energy Commission to collaborate with utilities and local municipalities to make charging stations part of a general plan, rather than being placed haphazardly. The third recommendation was to establish a uniform charging standards for manufacturers and stations. 7

8 Participants also discussed expanding level one infrastructure to many more locations (curbside, etc.), however, others noted that new vehicles will require significantly larger batteries and that level one infrastructure would therefore become obsolete. As a result, while it was agreed that expanding level one infrastructure is a good idea, it is clear that it is more of a short-term solution rather than part of a comprehensive long-term plan. Workforce Needs The employer survey included several important questions about workforce needs, which we discussed with participants at the roundtable. Just over half (57%) of employers surveyed have hired workers over the last year to support their electric vehicle business. Most employers are having some (62%) but not great (9%) difficulty finding employees that meet their standards. Figure 5: Difficulty Hiring Survey Not at all difficult 24% Don't know/ Refused 5% Somewhat difficult 62% Very difficult 9% When asked about the future, respondents think they ll face even greater challenges, with 32% believing that they will face significant difficulty finding qualified talent in the short term, though a majority think that this difficulty will have little to no impact on their firms ability to grow. 8

9 By and large, the positions that employers report having the most difficulty filling are engineers, skilled technicians, and balanced skill sets that include the business and technical components of the business. Event participants expanded on this vein of thinking when they said they need people who understand electricity and cars. At the same time, they believe that many of the best engineers in the area fully understand Megabytes but not Megawatts. The opposite side of that same coin also presents challenges for the industry, in that many of the workers with the right technical skills are not used to working in an innovation industry. One respondent noted It is easy to get auto people to move from Detroit but harder to get folks with the innovation attitude that start-ups require At the event, attendees participated in an instant poll regarding their preferences for training. Somewhat surprisingly, internships were cited as more valuable than previous experience in just one part of the industry, such as experience in automotive or electrical fields (Figure 6). Figure 6: Experience Instant Poll Several quotes are helpful for understanding these results, including: 9

10 The San Mateo (college) district, they have developed specific (automotive training) programs. We look for people with green MBAs and also BAs with options for environmental studies. I m very impressed with how quickly U.S. educators are adapting. Getting interns who work at other companies is a good source of information about other companies. There s a lot of mobility. We ve had really good success with retraining. Older workers are much more motivated. They are looking for new opportunities. It goes back to that passion question. Student design competitions are a very good source for recruiting workers. The Formula Hybrid International Competition, sponsored by the California Air Resources Board (CARB), is a good example of this. There are also solar car competitions. When looking for new hires, companies are most likely to focus on word of mouth and referrals, followed by online job postings and social media. Employers noted throughout the process that personal touch is critical, and that students should focus on meeting as many people as they can. Additional Feedback Outside of the formal engagement, participants offered several other thoughts. These include: Need for more women in the workplace Additional funding for community college training is a priority Automakers develop great programs but they are highly specific and a broad base would better serve workers Incentives are in permanent jeopardy and more certainty is required for continued success. Next Steps Employers are engaged and view NOVA and BACC as important partners. Suggested next steps include dialogue over treats as an obvious are of employer interest, and an expanded discussion over internship programs. NOVA and BACC should continue regular communications with participants and provide this report for their review and comment. 10

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