EVs Piling Up On Dealer Lots, Buyers Still Interested

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【Summary】EVs are taking longer to sell on dealer lots, but this doesn't mean demand is cooling. The high "days' supply" numbers are influenced by the pandemic and the transition to EVs, which is happening unevenly across different markets. While some regions like California are experiencing steady growth in EV sales, others, like Texas, are seeing a preference for gas-powered vehicles.

FutureCar Staff Aug 17, 2023 12:23 AM PT

EVs Piling Up On Dealer Lots, Buyers Still Interested

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 have indicated that electric vehicles are spending more than 100 days on dealer lots, suggesting a cooling demand. However, this data doesn't tell the whole story. In 2023, retailers sold 8.6 percent of all vehicles as electric, but they only made up 6.7 percent of available inventory. This indicates that demand for EVs is not actually slowing down, as explained by Tyson Jominy, vice president of data and analytics at JD Power.

The unusual supply metrics seen across the automotive industry can be attributed to the pandemic. Now that automakers are able to produce vehicles at their usual rates, it has magnified the days' supply metric for EVs. Jim Cain, a GM spokesperson, explains that low sales and rising inventory, common for newly launched vehicles, contribute to the high days' supply number. Additionally, if a significant portion of the inventory is in transit to dealers and not available for sale, the reading can be misleading.

The transition to EV adoption is not happening uniformly across all markets. Dealers in California have experienced steady growth in EV sales, but this is not the case everywhere. In Texas, for example, Ford dealers initially saw strong demand for the F-150 Lightning. However, once early adopters made their purchases and deliveries caught up, the majority of buyers still prefer gas-powered trucks. This has resulted in a slowdown in EV sales in the state, according to Stephen Gilchrist, a dealer operator in the region.

Despite variations in adoption rates, there is still significant interest in EVs across the country. It's too soon to conclude that demand is cooling. Mike Sullivan, owner of the LACarGuy network of dealerships, believes that EVs are destined to become a major force in the automotive industry. The pace of adoption may vary, but the direction is clear.