Wiktor Wise
Electric and hybrid cars are in high demand due to soaring gasoline prices, but they are in short supply and shoppers may struggle to find them at traditional dealerships. Despite the boom in sales, it is still almost impossible for some consumers to purchase electric vehicles from dealerships. A recent report from the Sierra Club found that 66% of car dealerships in the US did not have a single electric or plug-in hybrid vehicle available for sale. Toyota and Honda dealerships had the worst availability, with only 15% and 11% of dealerships respectively reporting at least one electric or plug-in hybrid vehicle in stock.
| Characteristics | Values |
|---|---|
| Demand for electric vehicles | Growing |
| Dealership availability | 66% of dealerships do not have an electric vehicle available for sale |
| Dealership promotion | Dealerships do not push electric vehicles in the same way as other cars |
| Manufacturer availability | Toyota and Honda dealerships have the worst availability of EVs |
| Manufacturer focus | Automakers have focused on building more lucrative pickup trucks and SUVs |
| Price | Electric vehicles are expensive |
| Environmental impact | Electric vehicles are better for the environment |
| Driving habits | Electric vehicles are better for those without daily freeway commutes |
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What You'll Learn
- Electric vehicles are in high demand, but dealerships struggle to make them available
- Dealerships don't push electric vehicles in the same way as other cars
- Electric vehicles are expensive and require an initial investment
- Electric vehicles are in short supply, and prices are climbing
- Electric vehicles are unavailable to test-drive in some areas
Electric vehicles are in high demand, but dealerships struggle to make them available
A recent report by the Sierra Club underscores this challenge, revealing that 66% of car dealerships in the United States did not have a single all-electric or plug-in hybrid vehicle available for sale. Toyota and Honda dealerships were particularly lacking in EV options, with only 15% and 11% of their dealerships, respectively, reporting at least one EV or plug-in hybrid in stock. This shortage is not due to a lack of interest from manufacturers, as most car makers now offer all-electric or plug-in hybrid options.
One significant factor contributing to the scarcity of electric vehicles at dealerships is the global production backlogs on key automotive components, which have reduced the overall volume of production across the industry. Dealerships also play a role in this dynamic, with some consumers reporting that dealerships do not actively promote electric vehicles in the same way they do for other cars. For instance, dealerships may pitch electric vehicles as a luxury item, highlighting their high cost and potential downsides, such as range limitations.
Additionally, automakers have focused their efforts on building more profitable vehicles like SUVs and pickup trucks, which accounted for over three-quarters of vehicles sold in the United States last year. This trend is influenced by consumer preferences, as many buyers opt for larger vehicles despite their higher fuel consumption. However, with rising gasoline prices, consumers are becoming increasingly mindful of fuel economy, and interest in electric vehicles is growing.
The challenge of finding electric vehicles at dealerships requires patience and perseverance. While the demand for electric vehicles is strong, consumers may need to navigate limited inventories and higher prices in both the new and used markets. Despite these obstacles, the transition to electric vehicles is gaining momentum, driven by environmental concerns, tax incentives, and the desire for improved fuel economy.
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Dealerships don't push electric vehicles in the same way as other cars
Firstly, many dealership salespeople do not have sufficient knowledge about electric vehicles to promote them effectively to customers. A study by Consumer Reports in 2014 found that 50 out of 85 dealerships visited either actively discouraged the purchase of electric cars or tried to persuade customers to buy a gas or diesel model instead. Similar trends have been observed worldwide, with salespeople in China, Scandinavia, and several European countries also failing to mention electric cars to prospective buyers or even actively steering them away from these options. This lack of knowledge and understanding among salespeople can create a significant barrier for customers interested in electric vehicles, potentially hindering the widespread adoption of this technology.
Secondly, dealerships make a significant portion of their profits from servicing cars, and electric vehicles typically require less maintenance and have fewer mechanical parts than traditional cars. As a result, dealerships may anticipate lower revenue from servicing electric vehicles, making them less enthusiastic about promoting these options to customers. This potential for reduced revenue could be a disincentive for dealerships to actively push electric vehicles, especially if they are concerned about the return on investment in the short term.
Additionally, the transition to electric vehicles may require costly infrastructure changes for dealerships. Many dealerships own the land on which their businesses operate, and converting these sites to accommodate electric chargers and other necessary infrastructure for electric vehicles can be expensive. This financial burden may deter dealerships from fully embracing the shift to electric vehicles, especially for smaller dealerships with limited resources.
The challenges of adapting to new technology and infrastructure, potential revenue losses, and the learning curve associated with electric vehicles contribute to dealerships' reluctance to push these options as aggressively as traditional cars. However, as demand for electric vehicles continues to grow, dealerships will need to adapt and find ways to effectively promote and support the adoption of these vehicles to remain competitive in the evolving automotive market.
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Electric vehicles are expensive and require an initial investment
Electric vehicles are expensive, and their high price is a significant barrier to purchase for many consumers. In mid-2023, the average price of an electric vehicle was about $12,000 more than the average price of a gas vehicle. This price difference is largely due to the high cost of batteries, which are the most significant component of an electric vehicle. While battery technology is becoming cheaper over time, this has not yet translated into lower prices for electric vehicles. Luxury automakers are also ramping up their electric vehicle offerings, which tend to be more expensive. Additionally, all-electric automakers like Tesla have been able to charge high prices due to strong demand for their vehicles.
The high cost of electric vehicles is further exacerbated by the fact that they are often positioned as luxury items by dealerships, which can make them seem even more unaffordable to potential buyers. This perception of electric vehicles as luxury items is reinforced by the fact that SUVs and pickup trucks, which are generally more expensive than smaller cars, accounted for more than three-quarters of vehicles sold in the US in 2022.
The demand for electric vehicles has been increasing due to rising gasoline prices, but this has also contributed to their high cost. In 2022, electric vehicles composed almost 8% of all car sales in the US, up from less than 1% in 2012. This increased demand has resulted in long wait times and seemingly random price increases for electric vehicles. Additionally, global production backlogs on key automotive components have reduced the volume of production, further limiting the supply of electric vehicles and pushing prices higher.
The high cost of electric vehicles is a significant obstacle for consumers who are interested in switching to more fuel-efficient and environmentally friendly options. While there are potential long-term cost savings associated with electric vehicles, the initial investment is often a barrier for buyers who may not have the necessary cash or credit facilities. This has resulted in a situation where electric vehicles are seen as a luxury that is out of financial reach for many consumers, despite the potential benefits they offer.
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Electric vehicles are in short supply, and prices are climbing
The issue of availability is not due to a lack of interest from manufacturers, who are unveiling electric models of their most popular cars to meet rising demand. Instead, it is the dealerships that are struggling to make electric vehicles available. A report from the Sierra Club found that 66% of car dealerships in the US did not have a single all-electric or plug-in hybrid vehicle available for sale. Toyota and Honda dealerships had the worst availability, with just 15% and 11% of dealerships, respectively, reporting at least one EV or plug-in hybrid vehicle in stock.
Some consumers have reported that dealerships do not actively promote electric vehicles, pitching them as a luxury item rather than a viable option for the average buyer. Others have noted that even when they are available, electric vehicles are often priced out of reach. The used market is also not a feasible alternative, with high prices that are sometimes double the cost of a new car.
The shortage of electric vehicles is not unique to the US market. In other countries such as India and China, consumers are also turning to hybrid electric vehicles to reduce their environmental impact. However, the high cost of these vehicles and the need for specialized maintenance can be barriers for potential buyers.
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Electric vehicles are unavailable to test-drive in some areas
Firstly, the ongoing global chip shortage and supply chain issues have impacted the availability of electric vehicles (EVs) for test drives. Dealerships are struggling to keep up with the demand for EVs, and as a result, many do not have sufficient inventory for potential customers to experience the vehicles firsthand. This issue is not unique to a particular manufacturer or dealership; it is a widespread problem affecting the entire automotive industry.
Secondly, some dealerships do not actively promote EVs in the same way they do with traditional internal combustion engine (ICE) vehicles. Dealerships may pitch EVs as a luxury item, which can be off-putting to potential customers. They may also emphasize the perceived downfalls of EVs, such as their range limitations, rather than highlighting their benefits. This approach can discourage customers from considering EVs as a viable option and may contribute to the unavailability of test-drive vehicles.
Additionally, the transition to electrification is still ongoing for many automakers. While most car manufacturers now offer all-electric or plug-in hybrid options, there is a lag time between announcements of electrification investments and the actual availability of these vehicles at dealerships. This delay can result in a shortage of EVs available for test drives, especially in certain areas.
Furthermore, the unavailability of EVs for test drives in some regions may be attributed to the dealerships' focus on traditional ICE vehicles. Dealerships may prioritize selling ICE cars, which have been their mainstay for decades, over the newer EV options. This could lead to a lack of emphasis on promoting and making EVs available for potential customers to test drive.
Lastly, the unavailability of EVs for test drives in certain areas could be influenced by regional preferences and market demands. Dealerships are likely to stock and promote vehicles that are in higher demand in their specific region. If a particular area has a lower demand for EVs, dealerships may not prioritize keeping them in stock or making them available for test drives.
It is important to note that the situation is not uniform across all dealerships and regions. Some dealerships, such as Volvo, have been praised for having EVs available to test drive, while others continue to face challenges in meeting the demand for these vehicles.
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Frequently asked questions
Electric hybrid vehicles are in high demand due to rising gasoline prices, but there is a limited inventory of new cars. Dealerships are struggling to make electric vehicles available, and some dealerships do not have any electric vehicles for sale.
Electric hybrid vehicles can help improve fuel economy and reduce transportation emissions, which has a positive impact on the environment.
Electric hybrid vehicles may be more expensive than traditional cars, and maintenance and repairs may be higher due to the need for specialized knowledge. Additionally, there may be a limited selection of models available.
