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This past week featured some very significant news in the auto industry. First, the New York Auto Show press days kicked off, with debuts of the Ram 1500 EV and the Kia EV9 – ushering in a show featuring a wide range of electric vehicle models.
As Patrick George of TechCrunch wrote, “Javits Center attendees will see new and upcoming EV offerings from basically every manufacturer, proving just how big this electric onslaught is going to be.”
Then in a Friday media briefing in Tokyo, Toyota announced it will introduce 10 new BEVs by 2026 while boosting sales of all-electric models 60-fold. If Toyota, the world’s largest automaker, is all-in on EVs, it bodes well for the entire vehicle segment. Overall, demand for EVs seems to be surging. potentially According to a 2022 Consumer Reports survey, 36% of consumers would consider an electric vehicle.
Of course, there are still a lot of hurdles for the EV industry to overcome. One of the biggest -- affordability – appears to be moving in the right direction. As ZeroSum reported in the March Market First report, the price for Lithium, an essential EV battery component, has fallen about 18% since January, according to Benchmark Minerals. This has made it possible for electric automakers to lower prices. After experiencing a demand boost from price cuts earlier in the year, Tesla cut prices again in March by another 4-9%. Over time, other automakers most likely will have to decrease their prices to remain competitive. This will continue to spur demand for EVs.
Given more models and potentially higher demand, EV and hybrid vehicle inventory will certainly increase. In March, overall electric and hybrid vehicle inventory increased the most it has all year, rising 17.13%. Most of this growth came from gas/electric hybrid inventory (22.89%), followed by plug-in hybrid (13.74%) and pure electric (13.38%). Electric/hybrid vehicle inventory is now up nearly 50% since December 2022.
With a slew of new electric vehicle models slated for showrooms in the coming years, identifying potential buyers will become increasingly important. As of 2020, owners of EVs were predominantly middle-aged white men earning more than $100,000 per year, according to Inspire Advanced Transportation.
The demographics are largely similar for plug-in hybrid electric vehicles (PHEVs).
While these demographics have held steady for several years, the number of lower cost EV entries is likely to attract a younger and less affluent group of customers.
As always, MarketAI will play a key role in helping dealers match the rising electric vehicle inventory with evolving customer demographics. The beauty of an AI and machine learning driven approach is that you get to take “gut feel” out of your marketing efforts and base your programs on real-world data.
The ability to quickly develop and test creative through MarketAI also will give dealers a significant advantage as they navigate shifts in EV customer preferences. As this week’s headlines attest, EVs are here to stay. A data-driven marketing approach built around MarketAI will help smart automotive retailers make the most of the new opportunities coming their way.
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