The shift to electric vehicles may ultimately change everything about the way we buy and own a car, but for the moment at least, studies are showing that customers prefer to maintain at least some of the traditional rituals of car-buying.
One of those is tried-and-true realities is a real-world showroom with a trusted brand name on the door. New releases from EV market analysts EVForward, a division of Escalent, a data analytics and business advisory firm, are painting a compelling picture.
According to the company’s 2022 Dealer Deep Dive, up to 74% of people who are open to purchasing an EV or actually intend to purchase an electric, would prefer to do so at a traditional showroom, rather than buying online direct from the manufacturer or through a brokerage service, Automotive News reported.
Predictably, those more familiar with the online buying process and younger buyers are more open to alternative buying processes, though no sub-group had a majority of consumers who prefer the online channel.
However, buyers do expect substantial online resources to be available, including general information about the vehicles and information on financing options. Buyers would also like to be able to schedule a test-drive appointment, according to EVForward.
A generation has grown up with online research
Online vehicle configurators have been available since the late 1990s, and at least two generations have become accustomed to exploring vehicle options and researching pricing using those tools.
Typically, dealers pick up the process after buyers have constructed their preferred vehicle, either finding a close match in stock or taking the configured vehicle as a manufacturer order. In either case, the customer walks in the dealership door knowing what they want, and about what they are willing to pay for the vehicle.
However, according to the EVForward data, customers will want the opportunity to take a test drive and at least metaphorically kick the tires before committing to the purchase. This is especially true if a price negotiation is required or if they must apply for financing. The preference for in-person interaction also extends through after-purchase support and vehicle service.
Legacy brands have an advantage
Additional research published by EVForward indicates that when considering an EV, well-known vehicle brands have an advantage over new specialty EV manufacturers.
“More than one-third (35%) of survey respondents indicate a preference for purchasing from a well-established automaker, while just under one-quarter (24%) indicate they’d likely look to an EV specialist to purchase their first electric vehicle,” EVForward officials said.
The study results should not come as a surprise: consumers are looking for dependable vehicles with the latest safety technology, offering good value for their money. They are also attracted to the low maintenance costs of EVs, and they want innovative features and technology.
When it comes to offering peace of mind on such a purchase, it’s predictable that companies with a long record of quality, such as Toyota, Honda, and others have a distinct advantage over startups. Consumers who grew up in Toyota-driving families and who owned Toyotas throughout their lives are more likely to stick with their trusted brand than take a risk on a new nameplate.
It also goes without saying that legacy brands have established dealer networks, which can more easily provide the showroom experience that consumers say they prefer.
The changing EV sales landscape
The consumer preferences articulated in the EVForward studies are being borne out in sales results. According to CleanTechnica, in the second quarter of 2020, Tesla had almost 83% of the U.S. electric vehicle market share. That was down to 63.8% in the second quarter of 2022, even with increased sales momentum. Worldwide, Tesla’s market share dropped from 25.1% to 15.6% in the same timeframe, again on increased sales.
While EV sales are growing, the number of available EVs is also proliferating. Established automakers such as Kia, Hyundai, Toyota, Subaru, Mercedes-Benz, Chevrolet and Ford are launching or expanding their electric-vehicle portfolios, pulling in an ever-larger share of a rapidly growing market. According to visualcapitalist.com there were two EVs you could buy in 2010; the Nissan Leaf and the Tesla Roadster, or you could lease a Mini E. By 2020, there were 48 EV models to choose from, and that number will be up to 134 by 2024.
As the market moves forward, a greater number of consumers make become more comfortable with buying a vehicle sight unseen, but it seems like that a majority will always want the chance to sit in a vehicle and test-drive it before making a major purchasing decision. However, it’s likely that consumers will welcome a change in the price negotiation portion of the sales process.