The Auto Industry Does Potentially Have A Sales Crisis Coming With EVs — But It’s Not What You Think

Join CleanTechnica’s Weekly Substack for Zach and Scott’s in-depth analyses and high level summariesjoin our daily newsletterand/or follow us on Google News!

There’s been a whole lot of incorrect, misinformed hype previously 12 months or two about EV gross sales. EV gross sales progress had exploded. Then the gross sales progress slowed down a bit, however EV gross sales had been nonetheless rising. But, many individuals — from CEOs within the business to media headline writers to regular people — made it sound like EV gross sales had crashed and other people didn’t need them.

So, the excellent news is that EV gross sales do continue to grow, in some areas sooner than in others, however virtually in all places.

Nevertheless, there’s probably a long-term gross sales demand concern for the auto business relating to EVs. A reader, Charlie Richmondjust lately pointed it out. “We are keeping our Teslas longer because the design is not aging and neither are the cars — they have cost us literally nothing to run and are good as new, even when they are 10 years old or more. In Vancouver, used Tesla prices have not crashed because there are so many of them, everyone knows how good they are.”

It’s a great level. If electrical automobiles are extra dependable, which they’re, and last more — or are “like new” for longer — then automakers may battle to search out as many new automotive patrons as previously. Why purchase a brand new automotive when your 5-year-old automotive seems like new?

That stated, there are fixed upgrades to automotive expertise, car design, and so forth. There’s additionally put on and tear on the seats, console, display screen, steering wheel, and so forth. So, there are causes to purchase a brand new automotive each few years simply as there have been for ages — if that’s the market you’re in. Nearly all of folks purchase used automobiles, not new ones. It’s notably richer individuals who purchase new automobiles, and long-term reliability might not be an important promoting level for the core of the market. It’s extra of what I wrote above — wanting the most recent, hottest, nicest car. That stated, there are actually some new-car patrons who care rather a lot about that, and for a cause, as a result of there are individuals who preserve their automobiles for 10+ years (I intend to be one in all them).

Additionally, if older automobiles are lasting longer because of the better reliability of electrical powertrains, there could also be much less demand on the used automotive market, which may damage resale worth, which may delay new automotive purchases from individuals who don’t like seeing a low trade-in worth on their current automotive.

So, how a lot will automakers truly take a gross sales hit? It’s exhausting to know. Nevertheless, it appears it should develop into an element to some diploma.