A year ago, auto industry analysts predicted that U.S. Sales of new electric vehicles (EVs) would rise to as many as 1.6 million in 2023. That didn’t happen. While EV sales easily set another record, they likely totaled no more than 1.3 million for the full year.
Manufacturers, watching inventories of unsold vehicles ominously grow, are second-guessing themselves. Market leader Tesla repeatedly slashed prices to boost sales. General Motors and Ford are delaying EV investments and production. And the chairman of Toyota, which has opted for plug-in hybrids over all-electrics, is grinning with schadenfreude.
Why EV sales are falling short
Based on our research, most Americans are anxious about the vehicles’ range. They also worry about sticker prices, insufficient financial incentives to buy electric, and too few choices. Significantly, these issues have only become more salient since early 2022, when we last polled on the topic, despite the accelerated buildout of a national charging network, an influx of new EV makes and models, federal and state tax credits, and deep price cuts.
All of this presumably should have only accelerated sales–and yet many consumers seem more hesitant.
Of course, the public is not monolithic. Those in their prime earning years, from their mid-30s to their mid-50s, are the most interested in EVs, with 60% of this group saying they’re at least somewhat likely to choose one as their next vehicle. However, they’re also by far the most likely to expect more from an EV purchase than they’re being offered today.
As the public face of the EV industry, Elon Musk is likely harming the cause. Asked whether they have a lower opinion of electric vehicles because of the actions of people associated with them, almost half of all Americans (45%) said yes.
Though EVs have lost some of their juice in the U.S., demand is still growing at an enviable pace. New electric vehicle sales topped 1 million for the first time, according to Cox Automotive, to around 8% of total sales, a market-share record. Car and light truck buyers can now choose from more than 40 models.
Consumer interest is rising, too. Just over half of Americans (51%) in our new poll said their next car likely will be a battery-powered electric, whether that’s within the next six months or as far out as five or more years from now. That’s up from 46% in our previous national survey.
Electric’s biggest fans, in addition to older millennials and younger Gen Xers, are people of color (62%), those in households with annual incomes of at least $100,000 (59%), college-educated Americans (58%), and men (55%). Conversely, people in households earning less than $50,000 annually (33%), those 55 and older (36%), white people (43%), people with a high school diploma or less (45%), and women (46%) are least interested in buying electric.
What would persuade prospective EV buyers to follow through
The factor most likely to push interested consumers to buy electric, cited by 61% of respondents, would be having more readily available charging stations. That’s nine points higher than in early 2022.
The next most important considerations were lower prices and financial incentives such as tax credits, both cited by 57% (versus 51% for the former and 49% for the latter in 2022). A wider range of models would nudge 53% to go electric with their next purchase (up from 45% in 2022).
General Motors CEO Mary Barra has acknowledged the demand-sapping effect of range anxiety in particular. “We must convince potential EV customers that their travel experience will be as easy and seamless as an ICE (internal combustion engine) experience,” she wrote in a summary of the company’s “challenging but rewarding year” newsletter.
But since many of these game-changers are, in fact, happening, the findings suggest that EVs will continue to go mainstream. We’ll reach a tipping point sooner or later when there are so many charging stations that no one will worry about getting stranded, and so many EV options that everyone will find one that suits their needs. And as EVs become cheaper (Tesla already has cut prices so much that base models sell for less than the average spent on a new car or truck), affordability won’t be a deal-breaker.
The biggest issue seems to be public education–helping consumers understand that their desires are being met. At that point, we’ll know whether they understand their own hesitations or have deeper, unspoken doubts. But who knows when that will actually occur. While researchers and analysts can confidently predict the direction of change, they cannot reliably predict its pace. There are too many variables. The real world, as carmakers are relearning, is a messy place.
Will Johnson is the CEO of The Harris Poll, a global public opinion, market research, and strategy firm.
More must-read commentary published by Coins2Day:
- Economic pessimists’ bet on a 2023 recession failed. Why are they doubling down in 2024?
- COVID-19 v. Flu: A ‘much more serious threat,’ new study into long-term risks concludes
- Access to modern stoves could be a game-changer for Africa’s economic development–and help cut the equivalent of the carbon dioxide emitted by the world’s planes and ships
- ‘Parroting Putin’s propaganda’: The business exodus over Ukraine was no Russian bonanza
The opinions expressed in Coins2Day.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Coins2Day .
