Nearly one-fifth of potential car buyers are either likely or very likely to consider purchasing an electric vehicle (EV) when the time comes to replace their current ride, according to a study conducted   by IBM's Institute for Business Value division.

Many automobile industry executives believe that sales of traditional vehicles will peak before 2020 and are looking to electric-only vehicles (EVs) as one of the next hot products, but they will first have to address stringent consumer requirements about EV performance, recharging, and convenience, the study said.

The report also says that about 30 percent of drivers surveyed said that they would consider switching to an EV that got 100 miles or less per charge and 40 percent of drivers said they would pay up to 20 percent more for an electric-only vehicle compared with a similarly-featured gas-, diesel, or hybrid-powered vehicle, with 27 percent saying they would pay 10 percent more and 13 percent saying they would pay 20 percent more.

To drive the price of electric vehicles into this more affordable zone, the IBV research indicates that automakers should initially focus on sales to both consumers and commercial fleets, building scale and creating economic efficiencies in production. Automakers may also need to develop new business models for electric vehicles to overcome the higher initial price.

Even under optimal circumstances, fully recharging an electric-only vehicle takes hours, said Kal Gyimesi, IBV automotive lead and co-author of the IBV study. So, it is crucially important that we build an infrastructure that can charge vehicles where their owners park them for extended periods of time - whether that is at home or at work, school, or the store.

The insights, from IBM's Institute for Business Value (IBV), are derived from a new survey of 1,716 U.S. drivers and interviews with 123 auto industry executives.

The governments across the world have set aside billions of dollars in the form of subsidies for early adopters of these alternative energy cars and to boost production of batteries for such vehicles despite persisting doubts about how many people will actually buy them.

The Department of Energy said it is investing $2.85 billion in electric vehicles of which $2 billion will go to help US carmakers produce advanced vehicle batteries and drive train components. Around $400 million will be invested to buy, test, and deploy different types of electric vehicles in the marketplace, and $300 million in cost-share projects under the Clean Cities program.

According to a recent report from Bloomberg New Energy Finance, plug-in electric vehicles, including plug-in hybrids and battery electric vehicles, have the potential to make up 9% of auto sales in 2020 and 22% in 2030 (1.6 million and 4 million vehicle sales respectively).