In the face of the setbacks stemming from inventory shortages, the auto industry continues to march forward into its electric future as consumer interest in electric vehicles (EVs) continues to rise. HIS Markit predicts that by 2025, one out of every three registrations will be for an electric vehicle and there will be four times as many models to choose from than there are today.
They also predict that the electric vehicles market will grow by 70% just this year.
While this is welcome news to car dealers looking for a glimmer of hope amidst all this uncertainty, the real question is how to position your dealership to take advantage of this coming shift—or if you even should.
In this post, we’ll explore:
- Why your dealership should embrace the electric vehicle revolution
- 4 things car buyers want to know about electric vehicles
- How to incorporate these into your electric vehicle marketing
Why add electric vehicles to your car dealer marketing?
Electric vehicles are now becoming more mainstream, with more and more carmakers announcing new electric models to their lineups on a seemingly weekly basis. Interest (and sales) in electric vehicles remains strong despite the pandemic and chip shortage.
Yet many car dealers are missing out on EV sales as auto sales associates struggle to learn and speak about the technology.
A recent McKinsey & Co. study found only about half of all sales reps were able to effectively discuss the merits of electric vehicles with their prospective customers. If that fact hits a little too close to home, then this post is dedicated to you.
What car buyers want to know about electric vehicles (and how to incorporate this into your car dealer marketing)
When it comes to marketing electric vehicles, your dealership is running up against two different challenges: One is that because EVs are still relatively new in the market, car buyers have a lack of knowledge about them. The second challenge is that there is an influx of content and marketing materials from other car dealers about EVs that you need to stand out from.
Car shoppers who are considering an electric vehicle are searching for more relevant, personal information. And by understanding their questions and what they’re looking for, you can build unique car dealer marketing materials that showcase your dealership as an authority and help you stand out from competitors in your market.
These are the things your customers are asking themselves when considering the purchase of an electric vehicle with some ideas for how to address these questions in your electric vehicle marketing.
1. How far can I go in my electric vehicle on one charge?
Many would-be EV shoppers mistakenly believe that an EV can only travel a short distance per charge, and in turn, develop a bad case of “Range Anxiety,” causing them to remove EVs from their purchase consideration.
Batteries are at the center of the discussion since they determine your range. Or to be more specific, the Lithium technology that powers them. In the past, electric vehicles struggled to reach over 100 miles. Fortunately, Lithium technology has come a long way and most modern EVs can easily surpass almost twice that distance now.
Let your customers know how this advancement will benefit them. What will it mean in terms of their daily commute, weekend outings, or family road trips?
2. Where can I charge my electric vehicle?
How many public charging stations are there in your community? Though the number is consistently growing, there is still a long way to go before the electric vehicle charging stations rival the scale of your local gas stations. To further complicate matters, public charging stations may not be operational or immediately available, information which is not always reported to national databases.
Electric vehicles come with either a Type 1 or Type 2 connector. Most public charging stations are of the Level 2 variety, and some even provide what’s called Level 3 charging. Also known as DC Fast Charging, it can bring a given EV’s battery up to 80% of its capacity in around 30-60 minutes.
Still, it is far more convenient and cheaper to be able to charge your EV at home. Having a dedicated charging pod professionally installed in your home will allow your customers to quickly and efficiently charge their EVs. While you can use a traditional 3-pin plug, this really should be a last resort. You see, the industrial class lithium batteries which power modern EVs operate at much higher wattages than other electronics in your home. So, using a traditional 3-pin plug will cause your customers an eternity to reach a full charge.
Let your customers know the facts behind how to charge their electric vehicles and where to find the nearest charging station in their community. Perhaps there is a Fast Charging station along a popular commute or near a large local employer, so be sure to include this message in your marketing collateral.
3. How much does it cost to purchase and operate an electric vehicle?
The U.S. government offers a Federal Tax Credit of up to $7,500 for EVs and Hybrids purchased on or after 2010. The amount will vary depending on the battery capacity of the vehicle. This credit will slowly phase out after the manufacturer reaches 200,000 EV/Hybrid sales.
General Motors and Tesla have already passed this threshold, and Nissan is next in line. But your customers may still qualify for state or local incentives. In California, for example, EV buyers can get a $2,000 cash rebate. Of course, your OEM will usually add their own incentives to sweeten the deal even more.
Insurance is another common consideration for most first-time EV consumers. Insurance premiums are, on average, higher for EVs than their gas-powered vehicles. This could cause some of your customers to feel that EVs are somehow less safe than their internal combustion counterparts. This is largely due to EVs being priced higher than conventional vehicles and the increased costs of repairs. Insurance companies still look at the big picture. Your driving record will impact premiums much more than your vehicle type.
The number of insurance companies offering discounts for electric vehicles is steadily growing, Liberty Mutual and Travelers both offer substantial discounts to EV owners and Tesla has been offering its own insurance to California customers since 2019.
But when it comes to fuel costs, EVs leave their internal combustion counterparts in the dust. AAA states that, the power required to travel 15,000 miles per year in an EV averages out to $546, while the price of gas required for the same distance averages out to $1,255. A savings of about 130%, sometimes even more.
All in all, EVs represent substantial cost savings over their internal combustion engine counterparts. Stay informed on all the current costs and incentives available to your EV customers, and you’ll stand out amongst your competition.
4. Is it best to buy or lease an electric vehicle?
This is a complicated question, and the answer will be different for everyone depending on their specific circumstances. While new vehicle leasing accounts for around 80% of all transactions, down and monthly payments are usually lower for EV leases than with conventional financing. Plus, most OEMs offer promotional lease deals with built-in cost reductions. Leasing an EV for two to three years will ensure that your customers will keep up with the latest technology, particularly regarding operating range.
On the other hand, leasing means that your customers will be making a perpetual monthly payment and may encounter unexpected charges at the end of the lease if they exceed mileage limits or other restrictions. For your customers who are comfortable with a long-term relationship with their EVs and the incurred costs of an EV’s battery-pack replacements, conventional financing might be a better option.
Federal regulations mandate that all EV’s sold in the U.S. have their power cells covered under warranty for at least eight years or 100,000 miles. Hyundai covers its Kona Batteries for life, however, some OEMs only cover their batteries against total failure. BMW, Chevrolet, Nissan, VW, and Tesla (Model3) will only replace packs if they reach a specific reduced capacity percentage, usually 60%-70%. If your customers plan on owning their EVs to the point that they require a battery pack replacement, it could be anywhere from $5,000 to as much as $15,000 to swap out plus the cost of labor.
The total cost of EV ownership will vary, and this may seem complicated to your customer. Let them know the pros and cons of all their purchase options and what this will look like for them.
Become an electric vehicle marketing pro
The electric vehicle revolution is here, and your customers are hungry for authoritative local advice on what this means for them. Dealers who create more of the same vanilla content that exists on their competitors’ sites and social platforms will be met with indifference. But car dealers who embrace this opportunity will be rewarded with increased sales, customer loyalty, and reduced costs per lead.
To master electric car marketing, ask yourself these questions:
1. What do my customers want to know about EVs?
- What will the impact of more and more EVs hitting the road mean for your community?
- What are some of the biggest regrets current EV owners have?
- Remember: Current EV owners are going to want different information than first-time EV owners.
2. Where are they getting that information now?
- OEM sites, third-party classifieds, online communities, are only a handful of avenues, but why not your dealership’s website?
3. Why is my dealership a better choice?
- What makes your dealership the local expert in electric vehicles for your community?