EVs Piling Up, Buyers Still Interested, Experts Note

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【Summary】Experts say that although electric vehicles (EVs) are piling up on dealer lots for more than 100 days, it doesn't mean that consumer demand is decreasing. The high "days' supply" numbers are partly due to the unusual supply metrics caused by the pandemic and the fact that EV sales are still in the early stages.

FutureCar Staff Aug 16, 2023 9:48 AM PT

EVs Piling Up, Buyers Still Interested, Experts Note

The transition to electric vehicles won't be smooth, and it won't happen evenly across the country, but high "days' supply" numbers don't necessarily mean consumers have lost interest.

Recent reports suggest that electric vehicles are sitting on dealer lots for more than 100 days, leading to assumptions of cooling demand. However, the reality is more complex than it appears.

Looking at the volume of EVs sold by retailers in 2023, it becomes clear that demand for EVs is not actually slowing. While 8.6 percent of vehicles sold this year were electric, they only accounted for 6.7 percent of available inventory.

According to Tyson Jominy, vice president of data and analytics at JD Power, the current data is misleading due to various factors. The pandemic has disrupted supply metrics, and now that automakers can produce vehicles at their usual rates, it magnifies the days' supply metric for EVs.

Jim Cain, a GM spokesperson, explains that low sales and rising inventory, which are common for newly launched vehicles, contribute to the high days' supply number. Additionally, if a significant portion of that inventory is in transit to dealers and not available for sale, it further skews the data.

The transition to increasing EV adoption is not happening uniformly across all markets. Dealers in California have witnessed steady growth in EV sales, but this is not the case everywhere. In Texas, for example, Ford dealers experienced a surge in demand for the F-150 Lightning initially. However, once early adopters received their orders and deliveries caught up, the majority of buyers still prefer gas-powered trucks, resulting in slowing sales in the state.

Stephen Gilchrist, a dealer operator with 18 locations in the region, emphasizes that the EV era is still in its infancy and expects some stops and starts as adoption rates increase. He believes that the idea of everyone driving EVs by 2030 is not accurate.

Despite regional variations, there is still significant demand for EVs in the country. Mike Sullivan, the owner of the LACarGuy network of dealerships, is confident that EVs will become a major force in the automotive industry. The only uncertainty lies in the pace at which this transformation will occur.