Otis Singleton
Electric vehicles (EVs) are becoming an increasingly common sight on roads around the world. As production ramps up, dealerships are seeing a surge in EV inventory, with nearly double the number of EVs compared to gas cars on their lots. This abundance of EVs is great news for prospective buyers, who can now more easily test drive different models before making a purchase. However, it also raises questions about the availability of charging stations, especially for those without dedicated home charging setups. While public charging stations are an option, they may not always be conveniently located or readily available, leading to potential frustrations for EV owners. As the popularity of EVs continues to grow, addressing these charging infrastructure challenges will become increasingly important.
| Characteristics | Values |
|---|---|
| Number of electric vehicles on dealer lots | Nearly double the amount of EVs compared to gas cars |
| Electric vehicle supply in days | 92.2 days, up 343% from a year ago |
| Electric vehicle sales | Up this year but not as much as inventory |
| Electric vehicle prices | Likely to go lower as inventory stacks up |
| Used electric vehicle prices | Dropping |
| Electric vehicle charging stations | Becoming more common but drivers will have to share access |
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What You'll Learn
Electric vehicles are piling up on dealer lots
Electric vehicles (EVs) are piling up on dealer lots, with a growing mismatch between supply and demand. While the auto industry is increasingly betting on electrification, consumers are proving hesitant to purchase EVs due to pricing and charging concerns. This has resulted in a surplus of EVs on dealer lots, with some brands experiencing higher EV inventories than others.
As of July 2023, American car dealers had over 92,000 EVs in inventory, a significant increase from the 21,000 EVs a year prior. Dealers traditionally aim to maintain a 60-day supply of vehicles, but some EV models now have bloated inventories well above 100 days. For instance, Genesis, the Korean luxury brand, had a 350-day supply of its nearly $82,000 Electrified G80 sedans. Similarly, Audi's Q4 e-tron and Q8 e-tron, and the GMC Hummer EV SUV, have inventories exceeding 100 days. These high-priced models are ineligible for federal tax credits, further deterring potential buyers.
Hybrid vehicles, on the other hand, have much lower inventory levels, indicating consumer preference for a gradual transition to fully electric cars. Toyota's Bz4X, the company's only fully electric model, has a 101-day supply, while its hybrid models are in shorter supply. Toyota's strategy of offering a mix of hybrids, plug-in hybrids, and pure EVs underscores the consumer demand for a range of electrification options.
The piling up of EVs on dealer lots reveals a disconnect between the auto industry's push for electrification and consumer readiness to adopt these vehicles. While automakers are investing heavily in EV production and infrastructure, dealerships are struggling to sell these vehicles, often resorting to negotiating lower prices with customers. The $7,500 federal rebate for EV purchases has done little to boost demand, and the industry is learning a hard lesson about the true level of EV demand.
Additionally, the glut of EVs on the market highlights the potential pitfalls of policymakers dictating consumer choices. The assumption that consumers would readily embrace EVs has led to an oversupply, with dealers struggling to clear their inventories. This situation underscores the importance of accurately assessing consumer preferences and ensuring alignment between industry offerings and market demand.
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The demand for electric vehicles is low
Electric vehicle pull-off lots are areas where electric cars are stocked or parked, often at dealerships. In 2023, there were reports of unsold electric vehicles piling up on dealer lots, with nearly double the number of EVs compared to gas cars. This trend is attributed to various factors, indicating a slowdown in demand for electric vehicles.
Firstly, high interest rates have been a significant factor in derailing the shift towards electric vehicles. Soaring interest rates have softened buying demand, leading to a buildup of inventory at dealerships. This has forced automakers and dealers to offer incentives and discounts to clear unsold electric vehicles.
Secondly, the sales momentum for electric vehicles (EVs) is slowing down globally, while hybrids (HEVs) and plug-in hybrids (PHEVs) are gaining more traction. Consumers are increasingly opting for HEVs due to their transitional nature, higher horsepower performance, and shorter payback periods. The economic advantages of HEVs cannot be overlooked, especially with the rising concerns around EV capital costs.
Moreover, the availability of EVs has been an issue in the past, with automakers facing production challenges and long waitlists. This has driven consumers towards readily available gas-powered vehicles. However, with car companies ramping up EV production and strengthening their supply chains, the availability of EVs is expected to improve.
Lastly, the impact of elections and government policies cannot be understated. Uncertainty surrounding elections and potential changes to EV-related policies have created a cautious atmosphere among consumers. This uncertainty has likely contributed to the slowing demand for electric vehicles as buyers await clarity on potential policy changes that could affect their purchasing decisions.
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Electric vehicle charging stations are expensive
The type of charger and battery also impact the cost of charging an EV. For example, a 240-volt (Level 2) recharge could be free or incur a fixed hourly rate or the price of the electricity transferred to the EV. In contrast, Level 3 chargers, commonly found in commercial settings, are too expensive for private individuals to install at home. As a result, charging an EV at a commercial charger can cost significantly more than charging it at home.
The availability of electric vehicles at dealerships has increased, which is good news for buyers who want to test drive an EV before purchasing. However, this has also led to a surplus of inventory, with nearly double the number of EVs compared to gas cars at dealerships. As a result, automakers and dealers are offering deals and incentives to clear inventory, and prices for EVs may continue to decrease as inventory stacks up.
While the expansion of the national network of electric vehicle charging stations under the National Electric Vehicle Infrastructure (NEVI) Formula program was intended to address this issue, the program has been suspended, and its future is uncertain. In the meantime, EV owners can use apps like A Better Route Planner or PlugShare to plan routes that include charging stations and take advantage of free or low-cost charging options at supermarkets, hotels, and workplaces.
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Electric vehicle charging stations are not easily accessible
Electric vehicle charging stations are often left unattended, which makes it imperative to ensure that they are accessible to all users, including those with disabilities. However, there are several reasons why EV charging stations are not easily accessible. Firstly, the location of vehicle charging inlets can be problematic. For instance, reaching some charging inlets requires long charging cables, and DCFCs may only be able to charge vehicles with inlets that can be reached from the sidewalk. This can be challenging for vehicles with charging inlets located on the street side.
Additionally, the design of EV charging stations can hinder accessibility. When EV charging stations are added to an existing site, they must connect to an accessible route, and a certain number of chargers must comply with specific standards, such as having clear floor or ground space and operable parts within reach range. However, some charging stations may not have enough space to accommodate large electric SUVs and trucks, and the cables provided may be too short to reach the vehicle charging inlets.
Furthermore, the accessibility of EV charging stations is not limited to physical infrastructure. The digital accessibility of mobile apps and websites associated with the EV charging network is also crucial. These digital platforms must meet the W3C's Web Content Accessibility Guidelines (WCAG) to ensure that individuals with disabilities can effectively use them. Unfortunately, the accessibility of these digital tools is often overlooked, creating barriers for users who rely on them to locate charging stations, make payments, and manage their charging sessions.
To address these accessibility issues, proactive measures are necessary. This includes ensuring that EV charging stations have adequate space and infrastructure to accommodate various vehicle designs and charging inlet locations. Additionally, providing longer charging cables can improve accessibility for vehicles with inlets that are challenging to reach. Moreover, clear and unobstructed access aisles, as well as compliant accessible routes, are essential to ensuring that individuals with disabilities can safely and independently utilize the charging stations.
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Used electric vehicle prices are dropping
Electric vehicles (EVs) have been losing their value, with a study by iSeeCars finding that they lost 58.8% of their value at the five-year mark, compared to the average of 45.6%. This is reflected in the used car market, where used electric vehicle prices have been plummeting. In fact, iSeeCars data from August 2024 showed that used electric vehicles fell below $27,000 for the first time, while used hybrid and gasoline cars remained stable at around $30,000.
The iSeeCars study analyzed the pricing trends of over 1.6 million 1- to 5-year-old used cars sold in August 2023 and 2024. It found that used electric vehicle prices lost 24.7% of their value over the past year, falling four times faster than hybrids and six times faster than gasoline models. This is a significant shift from the previous year, where used electric vehicles were priced 12.1% above used gasoline cars.
Several factors may be contributing to the drop in used electric vehicle prices. Firstly, there is an increasing supply of electric vehicles on dealer lots, with automakers ramping up production and bolstering their manufacturing and supply chains. This increased supply may be leading to more competitive pricing and incentives for consumers. Additionally, some electric vehicle models, such as Tesla, have experienced new vehicle price drops and aging product lines, which can impact the demand for used models.
The drop in used electric vehicle prices has had a positive impact on demand. Used EVs are selling much faster than they did a year ago, indicating that the price drops have improved their appeal to consumers. This is particularly true for those seeking a more affordable option, as the decrease in prices has made electric vehicles a potential bargain for used car shoppers.
While the drop in used electric vehicle prices offers benefits to consumers, it is important to consider the potential implications for those who currently own electric vehicles. The rapid depreciation of these vehicles could lead to significant losses in resale value, which may be a concern for individuals looking to sell or trade-in their electric cars in the future.
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Frequently asked questions
An electric vehicle pull-off lot is a dedicated space for charging electric vehicles. These lots can be found in various locations, such as dealerships, residential buildings, workplaces, and public areas.
As of 2023, the supply of EVs has been outpacing the demand. This has resulted in a higher inventory of EVs at dealerships, with an average stay of 92 days, according to Cox Automotive.
There are a few options available. You can locate public charging stations using mobile apps or use charging stations at your workplace if provided. Alternatively, you can petition your landlord or condo board to install an electric vehicle service equipment (EVSE) in the building's parking lot or garage.
A higher inventory of EVs at dealerships can help solve some of the challenges associated with EV adoption. It improves the availability of EVs for test drives and purchases, reducing the wait times and frustration experienced by consumers. Additionally, it can drive down prices and make EVs more accessible to buyers.
One significant challenge is the cost of installing charging stations, which can be prohibitively expensive, especially in residential buildings. Another challenge is the potential for congestion and competition among drivers for access to public chargers, which can be limited in number.
