EVs Piling Up On Dealer Lots, Buyers' Demand Remains

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【Summary】Experts say that although electric vehicles (EVs) are piling up on dealer lots for more than 100 days, it does not necessarily mean that consumer demand has decreased. The high inventory is partly due to the unusual supply metrics caused by the pandemic, as well as the fact that EV sales and inventory levels are not proportionate. While some markets, like California, are experiencing steady growth in EV sales, other areas, such as Texas, have seen a slowdown in demand after initial excitement.

FutureCar Staff Aug 13, 2023 8:46 PM PT

EVs Piling Up On Dealer Lots, Buyers' Demand Remains

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 indicate that electric vehicles are staying on dealer lots for more than 100 days, leading to concerns about cooling demand. However, the situation is not as straightforward as it appears.

An analysis of EV sales in 2023 reveals that although they accounted for 8.6 percent of vehicles sold, they only made up 6.7 percent of available inventory. This suggests that the demand for EVs is not actually declining, as claimed by some.

One factor contributing to the misleading data is the impact of the pandemic on supply metrics. The abnormal circumstances have distorted the days' supply metric for EVs, especially now that automakers have resumed production at pre-pandemic rates.

According to Jim Cain, a GM spokesperson, the high days' supply number can be attributed to low sales during the initial launch period and the increasing inventory of vehicles in transit to dealers, which are not yet available for sale.

The transition to increased EV adoption is also not occurring uniformly across all markets. While EV sales have been steadily growing in California, other regions, like Texas, have experienced a different trend.

Stephen Gilchrist, a dealer operator in Texas, explains that there was a surge in demand for the F-150 Lightning initially. However, after fulfilling the orders of early adopters, sales of gas-powered trucks have become more popular, leading to a slowdown in EV sales in the state.

Despite these variations, it is important to note that there is still significant interest in EVs across the country. Mike Sullivan, owner of the LACarGuy network of dealerships, believes that EVs will play a major role in the future of the automotive industry, even if the pace of adoption may vary.

Overall, while the transition to electric vehicles may face challenges and fluctuations, the demand for EVs remains strong, and their impact on the automotive industry is undeniable.