Doldrums in U.S. electric car sales could linger indefinitely
DETROIT (Reuters) - A 'green' showroom, free charging stations and several acres of solar panels are all part of the pitch by Galpin Ford dealership to environmentally minded car buyers in southern California.
So how many plug-in hybrid and electric vehicles has the Los Angeles dealership actually sold?
"Very, very few," said Beau Boeckmann, whose family owns Galpin Ford, the automaker's largest U.S. dealership. Only 2 percent of the vehicles Galpin sold last month were plug-ins.
Dealers and analysts don't envision a huge leap in sales of plug-ins any time soon despite still-high gasoline prices, a raft of price cuts and cheap lease deals on EVs. Other enticements include a steady stream of new green-car entries and hefty federal and state incentives.
"Between now and 2020, I don't see (EVs) getting too far beyond a couple of percentage points" of market share, said Matthew Stover, an industry analyst with Guggenheim Capital Markets.
Obstacles to EV sales include getting shoppers just to try an electric or hybrid car, easing their qualms about such things as having enough charging stations and, for the salesman, the extra time and effort it takes to close a deal.
HybridCars.com, which tracks sales, says demand for plug-in vehicles is beginning to pick up. But total plug-in volume remains relatively modest - only 32,705 sales through May, representing a modest 0.5 percent of total industry sales.
CADILLAC AND BMW EVS
With even more new EVs and hybrids on the way later this year, including the BMW i3 and the Cadillac ELR, manufacturers are stepping up discounts on their green cars.
General Motors Co (GM.N: Quote, Profile, Research, Stock Buzz) is the latest company to offer aggressive pricing. GM on Monday announced incentives of up to $5,000 on the Chevrolet Volt, whose U.S. sales through May were relatively flat at 7,157. GM in late May also launched the new Chevrolet Spark EV with a lower-than-expected starting price of $27,495 and is offering discounted lease rates on both the Volt and the Spark EV. [ID:nL2N0E31RA]
A similar strategy is being pursued by other plug-in manufacturers, notably Nissan Motor Co (7201.T: Quote, Profile, Research, Stock Buzz). A price cut in January of more than $6,000 boosted sales of its Leaf EV to 7,614 through May.
Somewhat unexpectedly, both the Leaf and the Volt have been outsold this year by the Tesla Model S, a battery-powered luxury sedan that is more than twice the price of the Leaf and nearly double that of the Volt. Sales of the Model S through May were 8,850, making it the best-selling plug-in car in the United States despite a starting price of $70,890.
Tesla has been more successful than older, more established automakers in selling EVs, in part, because it appeals to a niche group of tech-savvy, status-conscious buyers, said Stover.
"This is the same set that will buy a Ferrari," he said.
Tesla also has been able to alleviate such buyer concerns about EVs as short driving range, long charging times and lack of charging stations.
Car dealers for other brands that sell plug-in vehicles face a "chicken and egg" scenario, said Detroit-area auto analyst Alan Baum. Consumers eventually will become more comfortable with the inherent limitations of many EVs once they spend more time in the vehicles, but dealers are still struggling to get drivers into the cars, he said.
Retail salespeople also are reluctant to spend the extra time it takes to educate buyers about the benefits of electric cars and how they differ from conventional models.
"Dealers are going to take the path of least resistance to sell," Baum said.
It is "more intensive" to sell EVs, said Edward Tonkin, vice president of 16 Tonkin dealerships in Oregon, even though buyers in the Portland area tend to be more tuned in to environmental issues.
"That resonates here, but it might not in the Midwest," he added.
I like that term "Doldrums" for the EV market.ReplyDelete
I'm not sure why people should be surprised that the Tesla S outsells the Volt and Leaf. At current price points it is still geared (no pun) towards the upper class.
First you need an income well above the median to have the income tax to "spend" on the federal tax credit. Second you need a secure place to charge the vehicle (ie garage space). That eliminates a huge chunk of buyers.
Too expensive for the low end, the Volt is also a non-starter for a large segment of the upscale buying market because it is a Chevy. If it had been a Cadillac they probably could have interested more BMW 3-series and Mercedes 300 class, and Volvo S60 etc buyers, but most of that market segment will never consider a Chevy.
If Nissan can eventually get the Leaf price down to the low 20's there is probably a nice little market segment for a 100 mile range urban runabout as a household's second or third vehicle.
Comparing Tesla to the other so-called electrics is apples and oranges.ReplyDelete
Tesla makes a great car that anyone would buy at that price regardless of the engine - it's as nice or nicer than E class Mercedes and 5 series BMW. The fully loaded fastest version is faster than a ferrari, and looks like a maserati. It's the most technology advanced cockpit of any car made.
As to the Ford and Nissan so-called electrics, YOU HAVE TO PUT GAS IN THEM!!!!! I don't want to buy a cheap plastic looking EV and then have to go to the gas station!!!!
I think the market will take off better than expected once there are options out there. Right now, it's only Tesla, at $70k plus, that provides an all electric experience. Soon, there will be more...
And, by the way, I want an electric so i'm not dumping exhaust fumes into the air that i breathe. I grew up in Southern California smog, and don't want to contribute to the pollution.
Love your web site, my only complaint is that you don't post more often!!!
Just an FYI, the Nissan Leaf is an electric vehicle, not a hybrid.
WRT the Volt, by classifying it as a cheap plastic looking EV, its apparent you haven't actually looked at one. As a plug in hybrid, the Volt does use gas and it depends on your driving situation how often you have to fill up. I've seen plenty of reports from owners who say they fill up every 4 to 6 months. Obviously if your typical daily range requires invoking the engine a lot, the Volt is probably not the best choice.
I assume with the Tesla you are willing to live with the much more significant negative environmental impact that comes from manufacturing large battery EV's vs manufacturing conventional vehicles, since most of that will come outside of So Cal. And there should be a positive tradeoff at the exhaust level when compared to the pollution generated at the power plant.
Electric cars: Unclean at any speedReplyDelete
If the electric cars has been lowbat in the road? can we charge it anywhere?ReplyDelete