As I drove through the parking lot, I saw rows of unsold electric cars and wondered how this could happen. everyone The transition to EVs was underway.
Let’s start with the rental car companies. Rental car companies were supposed to help people get used to electric cars. Now Hertz is selling over 30,000 electric cars due to high depreciation, customer dissatisfaction, and huge repair costs. Other rental car companies are following their lead.
Ford CEO Jim Farley recently stood next to an F-150 Lightning while it took the car 40 minutes to charge from zero to 40 percent, and he acknowledged that faster charging speeds are needed to attract buyers for gasoline-powered trucks.
Slow Life
Car buyers are also not showing any interest, and unsold cars sit on dealership lots for an average of 1.5 times longer than hybrid or gasoline-powered vehicles.
Jaguar’s iPace is a stylish electric SUV designed to attract first-time EV buyers. Dissatisfaction with the iPace’s poor range and high $72,000 price tag has left dealers with as many as 400 unsold units — nearly two years’ worth of inventory.
EV adoption and sales growth is slowing. Even market leader Tesla is feeling the slump: First-quarter sales were down 15.2% compared to last year’s fourth quarter, and sales are down nearly 10% compared to just a year ago.
Tesla recently responded by laying off more than 10% of its global workforce, but the company is also feeling pressure from arch rival BYD, the Chinese automaker that offers a wide selection of sub-$30,000 EVs and pickup trucks and is set to soon expand into the US.
The early rise of EVs
It seems like just yesterday that every automaker was jumping on the EV bandwagon.
Jaguar has committed to having all its vehicles electric by 2025. Alfa Romeo has committed to doing so by 2027, Chrysler by 2028, and Volvo, Lotus, Aston Martin, General Motors and others by 2030.
The mood was euphoric, and there was a lot of speculation about one day having electric ships, electric planes, and even electric spaceships to the moon.
Now, enthusiasm for EVs has cooled, and automakers are scaling back or postponing electric vehicle plans.
Catfishing in a car
This is what I call a catfish on wheels.
First, the bait. There’s no question that all the new technology and design is great. The tech-savvy early adopters were quick to buy. Their enthusiasm skyrocketed sales for all brands, but it seems like every tech enthusiast who bought one is now buying their second or third electric vehicle.
Now we have to convince the rest of us that we need an EV in our garage. EVs aren’t cheap, especially when you factor in high insurance costs. The average EV costs $65,000, while old-fashioned gas guzzlers average a steady under $50,000.
Then there’s charging. When it comes to powering up, these gorgeous cars can be a bit high-maintenance, so why take it to the good old corner gas station to fill up with unleaded gas and buy some potato chips?
Sure, charging networks may be improving, but it’s still uncharted territory for many. Range anxiety can bring you to the point of a nervous breakdown. So can unreliable performance in cold weather. So can limited towing capacity. It’s not all about looks; reliability matters, too.
EVs are even more likely to depreciate than regular cars: If you bought an iPace new in 2019, its resale value would have fallen by more than 54% by now.
Slacker of Lot
The Porsche Taycan is one such car. It delivered on the promise of a four-door electric version of the Porsche 911 but hasn’t seemed to attract buyers. It probably doesn’t help that it remains in stock for an average of 239 days and has an MSRP starting at about $90,000. The Tesla Model S and Lucid Dream Performance offer longer range at a lower price.
The Mercedes-Benz EQS sedan and SUV are even more expensive. They come equipped with complex technology like MBux wide screens that are impressive but may be overwhelming for some. Mercedes-Benzes are the height of luxury. And yet, on average, these cars sit in car parks for a staggering 221 days.
The Ford Mach-E initially captivated the market with its iconic brand appeal, impressive performance and innovative features. What’s not to love about an EV Mustang? Apparently there are plenty of reasons, including the fact that Tesla’s Model Y has a longer range. The Mach-E is kept in inventory for an average of 204 days. If you bought the first model in 2021, you would have only made a small fortune with the 50% depreciation.
New to the market is the Genesis electric car. The GV60 is a fun, tech-packed interior. But with a starting MSRP of $52,000, it’s a bit too steep to convince consumers leaning towards Tesla, which has a robust Supercharger network. Along with its siblings, the G80 and GV70, the car tends to stay at dealerships for an average of 190 days.
Ford’s F-150 Lightning is the best-selling electric pickup truck, but it will soon face tough competition from an EV version of the Chevrolet Silverado.
Ford recently announced it was halving production of the F-150 Lightning from 3,200 vehicles per week to 1,600. When it first debuted, Ford promised the F-150 Lightning would have all the same features as the gasoline-powered model, including its Pro Power on-board system that provides built-in power outlets for power tools and other equipment.
Ford has since walked back those boasts.
Recently, Ford CEO Jim Farley stood beside an F-150 Lightning while it took 40 minutes to charge from 0 to 40 percent. He acknowledged that faster charging speeds are needed to attract gas truck buyers. It’s no surprise that an F-150 Lightning has been left in a parking lot for 182 days, with early adopters already losing 61% of their initial investment in just two years.
The Nissan Leaf is affordable but can’t seem to keep up with more attractive rivals, but it is competitive when it comes to average storage time, clocking in at an impressive 161 days.
The Cadillac Lyriq doesn’t fare much better, with an average of 151 days, despite a smooth driving feel and a quiet, luxurious cabin, likely due to a variety of technical and software issues, as well as complaints about substandard dealer interactions.
Hybrid vigor
Many consumers are switching from electric vehicles to hybrids. It makes sense that those interested in EVs would also consider hybrids, especially plug-in hybrids that can run on electricity for short trips and switch to gasoline for longer journeys.
The Toyota Prius has offered this technology for almost 30 years and has proven to be a very reliable and fuel-efficient vehicle. The technology is also being adopted by other brands such as the Lexus RX Hybrid, Ford Escape Hybrid, and even ultra-luxury SUVs like the Mercedes-Benz GLS 450 4Matic SUV. This is a mild hybrid and is offered at a lower price compared to full EV models.
An all-electric plan may have sounded good on paper, but consumers are starting to vote with their wallets, and General Motors has decided to give customers the choice between switching to electric vehicles or sticking with gasoline-powered vehicles.
As I’ve been saying for decades, let the buyer decide. Choose what works best for you. Let’s see how many other car companies learn this lesson.
