The electric vehicle (EV) market is currently experiencing a whirlwind of activity, with sales reaching unprecedented levels. In this blog post, we delve into recent articles that shed light on the surge in demand for electric vehicles, the challenges of supply shortages, and the consequential impact on both new and used EV markets.
- The Growing Backlog: Recent reports, such as the one from Tesla Roddy, highlight the increasing backlog in electric vehicle sales. The article suggests that the shortage in the market might be a prolonged phenomenon. Unlike the past, where cars were readily available on dealership lots, the present scenario requires customers to either place orders or patiently wait for their EVs to arrive. This scarcity, though labeled a “shortage” now, could become the norm as manufacturers shift away from building speculative inventories.
- Impact on Used EVs: Delving deeper into the issue, an article from Recurrent emphasizes how the shortage is not limited to new EVs but is also affecting the used EV market. With electric vehicles accounting for five percent of new car sales in the U.S., the maturation of the used EV market is evident. High gas prices and an unstable market have led to a surge in interest in used EVs, marking a significant shift in consumer behavior.
- Changing Consumer Preferences: The article notes a change in consumer attitudes towards used electric vehicles. While surveys in the summer of 2021 indicated that just over 50 percent of EV shoppers considered buying used, a year later, this figure has surged to 80 percent. This shift indicates a growing acceptance of used EVs as a primary choice, challenging the traditional preference for gasoline-powered vehicles.
- Mainstream Acceptance: The automobile industry is witnessing a remarkable development as car dealerships report selling a higher percentage of EVs. No longer reserved for a niche market, electric vehicles are gaining mainstream acceptance. This shift is significant, with dealerships now considering dedicated used car departments for electric vehicles to meet the increasing demand.
- Pricing Trends: However, the surge in demand comes at a cost. Pricing trends in the EV market reveal a consistent upward trajectory. Even comparing the prices of the same models, both new and used, showcases a notable increase. The shortage has led to individuals buying new EVs and quickly reselling them, driving up prices in the used electric vehicle market.
The electric vehicle market is at a crossroads, with soaring demand, supply shortages, and changing consumer preferences reshaping the industry. As the surge in EV popularity continues, it remains to be seen how manufacturers and dealerships adapt to these shifts in the market, ultimately determining the future landscape of the electric vehicle industry.