The Big Electric Car Fail: Why They Aren’t Winning More Buyers
Why Aren’t More Car Buyers Going Electric? While the EV market has grown in 2023, sales aren’t rising as fast as expected, even with new model launches and price cuts and generous tax credits lowering costs for buyers. Automakers are taking notice and acting accordingly.
Automakers are being forced to lower their EV prices to attract customers and compete with Tesla. But this approach is especially painful because they’re already losing money on their EV investments.
Why aren’t people buying EVs:
EVs are too expensive: Joseph McCabe, president of AutoForecast Solutions, says vehicle cost is the No. 1 barrier to EV adoption. EVs usually cost at least $10,000 more than their comparable gas counterparts, he says.
Charging is expensive: If you can charge your EV at home, there are considerable fuel savings that come with going electric: You’d spend about 3x more on gas than the cost of home charging. However, the costs are about the same if you’re using a public charger, and getting fuel at a gas station is much more reliable and less time-consuming.
Charging is inconvenient: Fast chargers are still hard to find in many more remote parts of the country. According to AAA, 56% of people say the lack of convenient charging is a top reason for not going electric.
Depreciation: The average used EV price dropped nearly 20% in the past year, according to iSeeCars.com. Potential EV buyers have good reason to worry their cars won’t hold their value well as the technology improves. “The used market is not as strong for electric vehicles, and as a result the depreciation is higher,” says Greg Brannon, director of automotive engineering research at AAA. “That’s your single biggest operating expense.”
Range anxiety: Some high-end EVs promise 300+ miles of range on a single charge, but even that is not enough to cover a common drive like San Francisco to Los Angeles. You’d have to take a charging break, potentially adding 30 minutes or an hour to an already long drive.
Hybrids are more popular: According to Adam Ragozzino, principal analyst, batteries and electric powertrains at Wards Intelligence, Tesla isn’t the best-selling electrified vehicle brand in the U.S. It’s Toyota, which has over 20 hybrid models and is focused on these cars in the near term, given that they offer good fuel efficiency and are capable of making long trips without requiring charging breaks. Hybrids are not only more practical and familiar to drivers than EVs, they also tend to be cheaper.
Auto experts are increasingly skeptical that the U.S. will be able meet a 2032 target essentially requiring 67% of new cars to be EVs. Right now, the current EV market share in the U.S. is just 7.9%, according to Cox. Automakers are already adjusting their own goals, and it’s possible that more EV model launches will be delayed in the coming months.
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