EREV is a range extender, not a PHEV.  You still have to charge the batteries just not as often.

EREV seems to be the way to go with larger vehicles. As for towing, that's really only an issue with large EVs because charging on a road trip is a pain in the ass. With EREVs where the gas powertrain is what you're relying on for longer road trips, it's not a big deal because you just top off like every other ICE vehicle at a fuel station, so towing is a none issue. It's only an issue if recovering that range is a pain like it can be with an EV. 

It is going to be fascinating to see how this plays out. Initial testing results  and physical laws indicate this use case is where EREVs are going to fail miserably compared to ICE or hybrid.

If EREVs cost significantly more than hybrids, and I think they will, it will be difficult to convince buyers to spend the added premium, particularly if they get very little or nothing in return from a financial standpoint.  For cheaper vehicles where hybrids are already getting 50 MPG, there won’t be much cost savings IMO.  Some buyers will undoubtedly prefer the EV-like driving mode possible with EREVs, but I can’t imagine that many buyers paying a significant premium for it.  Where EREV makes more sense to me are for pickups and large SUVs that will be used for towing longer distances.  Even then total cost of ownership may be difficult to justify compared to latest hybrid technology.  Going beyond latest hybrid efficiency does not generate much energy savings due to diminishing returns.

For what it’s worth, Honda Civic hybrid from just over 10 years ago had 1.5L.  And that was with less powerful electric motor.  Obviously much depends on car size, weight and performance expectations.  Older Civic Hybrid were probably smaller and slower than what most buyers want today, in US anyway.  You may also be interested in knowing that current Toyota Yaris and Honda Jazz hybrids in other markets have 1.5L Atkinson engines, and achieve impressive fuel economy approaching 70 MPG (EPA rating would be lower).  Basically saying that if Honda can get by just fine with 2.0L Atkinson in Accord or CR-V hybrids, then it shouldn’t surprise anyone that smaller vehicles can get by equally well with a smaller engine to optimize fuel economy.  Granted Americans do not seem interested in vehicles the size of Honda Fit presently, but the technology is proven and available in case demand increases.

It's definitely gonna be a challenge without a doubt. Correct me if I'm wrong, but from my understanding, the biggest selling point of EREVs especially larger EVs, is because they still have ICE powertrains as generators, the battery packs themselves are much smaller than larger pure EVs, which means these larger EREVS are far more affordable than large pure EVs. I believe Ford was saying they believe their EREVs will be able to sell for about the same price as a nice hybrid.    If that's true, I can see the appeal of those types of vehicles. Having a smaller battery so you enjoy all electric driving during short drives, while having the gas powertrain during longer trips sounds like a really good solution for people who want an EV, but also want to take long road trips without worrying about having to charge. 

Fear doesn’t have to be justifiable to be real, and hence influence behavior.

How many batteries actually need to be replaced in say the first 10 years of ownership? 

That’s what I was implying.  A relatively affordable Tesla Model 3 as example with “existing” batteries already provides up to 363 miles of range, and can also charge fairly fast.  Obviously some people don’t like the styling and others hate Musk, but point is that BEVs are not all that bad even now.  There must be other hurdles, right?  IMO issue of battery replacement fears for one needs to be addressed.   As previously mentioned the upcoming Nissan Leaf and Chevy Bolt at even lower estimated prices may surprise.  Or not.  We’ll see soon enough.