Car dealer Brad Sowers is spending money to prepare for the wave of new electric models from General Motors Co. It installs charging stations, modernizes service locations and retraines its staff in the St. Louis to handle vehicles with technology.
But when he considers how many screws Chevy Plugs sold last year – nine of the nearly 4,000 Chevrolets sold at its dealerships in Missouri – he pauses.
“The consumer in the middle of America just isn’t there yet,” when it comes to switching to electric vehicles, he said, citing the long distances many of his customers drive daily and the lack of charging infrastructure outside big cities.
While carmakers and investors are buzzing about the future age of the electric car, many dealers say they are striving to instill that enthusiasm with today’s reality in new car sales lots, where last year battery-powered vehicles accounted for less. 2% of US Car Sales.
Most consumers who come to showrooms do not buy electric cars, and with relatively low gasoline prices, even hybrid models can be a difficult sale, say dealers and industry analysts.
Car manufacturers are moving aggressively to expand their range of electric vehicles with dozens of new models to arrive in the coming years. Some like GM set firm goals when they intend to completely eliminate gas cars.
Sales consultant Robert Mason Jr., center, spoke with Paul Sweeney, left, and his son, Jeff, who was buying a Chevrolet Trail Boss from Jim Butler Chevrolet in Fenton, Mo, on Friday.
Many dealers say this puts them in a delicate position: they are trying to adapt, but they are not sure if and how quickly customers will change. About 180 GM dealers, or about 20%, have decided to give up Cadillac franchises, rather than investing in expensive upgrades that GM has asked to sell electric cars.
A GM spokesman said the company expected some Cadillac dealers to give up and was pleased that the remaining approximately 700 share its fully electric targets.
Previous attempts by automakers to expand sales of electric vehicles have largely flop, selling retailers with unsold inventory. Even now, some dealers say they are reluctant to stock up on mass-produced electric models.
“The biggest challenge is that dealers have a little bit of wolf boy crying syndrome,” said Massachusetts dealer Chris Lemley.
Automakers have promised for years that they will make ordinary electric cars, but will only produce low-volume niche models, he said. He remembers Ford Motor Co.
launching a completely electric Focus that sold poorly and piled up on its lot. It was discontinued in 2018.
“So when we’re told, ‘This time, we really mean,’ it’s easy to be skeptical,” Lemley added.
Also, some buyers are unsure. Joe Daniel, an energy analyst at the Union of Concerned Scientists, said he was determined to buy an electric car, but eventually gave up after realizing there weren’t enough public charging stations nearby. His apartment in Washington, DC Without a place to connect in, the purchase did not make much sense, he added.
“For electric vehicles to take off, they have to be as convenient as gas-powered cars – that’s the essence of this big acquisition,” said Daniel.
Long waits have gone to charging stations: the Chinese start-up of NIO electric vehicles is the pioneer of battery replacement systems, challenging Tesla and other rival carmakers. Here’s how NIO and Tesla compete for the world’s largest EV market in China. Photo illustration: Sharon Shi
To solve such problems, President Biden said he wants to spend billions of dollars to modernize the country’s charging infrastructure as part of an action to boost battery-powered cars.
Ford, GM and other major car companies say they are confident in their new electric vehicle offerings and are preparing dealers to sell and maintain them.
However, some retailers say they are worried about the long-term implications for their business.
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The influence on the electric car market has created a new standard for car buyers, offering an online transaction and a simplified range, without price negotiation. Other electric vehicle start-ups, such as Rivian Automotive and Lucid Motors, say they will also sell directly to consumers and bypass traditional representatives.
Some car companies follow suit, initially stocking dealerships with few electric models, if any, and allowing customers to order more directly from the manufacturer.
Håkan Samuelsson, CEO of Volvo Cars, recently said that all future battery-powered electric vehicles will be sold exclusively online and that the price will be set centrally, eliminating the possibility of bargaining. Representatives will help deliver vehicles to customers and perform other services, such as maintenance, he said.
“The market is moving from physical to online representation. That will happen in the next 10 years, “said Samuelsson.
Howard Drake, a GM dealer in Los Angeles, said he is considering transforming two of his showrooms. Instead of separating the models according to the brand, he is considering two stores – one for electricity, the other for gas vehicles.
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“These are really different customers,” said Drake. “A Hummer EV buyer probably doesn’t want to sit next to a guy buying a gas-powered van.”
Mr Sowers said he saw encouraging signs. GM recently lowered the price of the electric Bolt sticker and helped increase sales for the model in February. However, he said that his inventory of electric vehicles will remain easy because he is not sure about the long-term demand.
“It’s still very early,” Mr Sowers said.
As soon as dealers figure out how to sell electric vehicles, another business problem awaits in the service area.
Troy Carrico worked on a Chevrolet Corvette.
Electric vehicles usually have fewer mechanical parts and do not require the same type of service that gas-powered cars need, such as oil changes. This work right now is a great profit center for representations.
“It will have an impact, but it could take three or four years to see the full effect,” Mr Lemley said. “This is really my biggest question that goes to all of this.”
—William Boston contributed to this article.
Write to Nora Naughton to [email protected]
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