CarGurus Consumer Study Reveals EV Intent, Dealerships Aren’t Done

Business

Auto buyers are slipping back to some pre-pandemic habits, but are surprisingly satisfied with their deals, while high gas prices may have boosted interest in electric vehicles but that interest isn’t compounding into sales. Those are some of the top findings in a new consumer study released Wednesday by auto research and buying site CarGurus.com.

The survey, titled “2022 Consumer Insight Report” is based on responses from 3,008 “recent auto consumers” split between buyers and sellers taken last April and May with an additional 600 sellers queried in July.

The auto buying process had already begun shifting to a more digital experience even before the Covid-19 pandemic took hold in the U.S. in March, 2020, but once showrooms shut down and shoppers were homebound, that shift accelerated.

But the CarGurus study reveals consumers aren’t quite ready to give up marching down to the dealership completely.

“What we’ve seen is interest in doing more from home is still really high, in fact, even higher than last year— 70% of buyers say they want to do more from home up from 60% last year,” said Alexandra Howerter, CarGurus Senior Consumer Insights Analyst. “But the number of buyers who want to do it completely from home has stayed the same, just at 59%. The test drive still a very big deterrrant. They still find it very important to get a feel first hand in the car.”

At one time a dealer’s location was an important to consumers who had preferred doing business closer to home or work. But the survey revealed it’s now all about the bottom line, with 50% citing pricing as their top reason for choosing a dealer. Location limped in as number four with only 24% pegging their dealer choice to location, down from 30% in the 2021 study.

One major pandemic side effect is the dearth of inventory on dealership lots due to production delays caused by supply chain interruptions. That’s led to automakers pulling back on incentives and other deals since they have less metal to move.

Advertisement

With fewer discounts out there it would follow shoppers are unhappy with their deals. But the CarGurus study indicates, surprisingly, that’s not so.

“We were expecting customer satisfaction with deal perception to take a hit, but 80% thought they got a good or great deal,” Howerter told Forbes.com. “Really interestingly, the number one reason was ease of process. It’s emphaiszes how important it is to offer that streamline experience. Not only speed of sales but satisfaction with the deal itself.”

Gas prices have retreated but they’re still high. That situation spurred greater consumer interest in vehicles that don’t run on gasoline, or at least less of it. So far sales aren’t keeping pace with consideration.

According to the study, 35% said they considered a hybrid vehicle but only actually purchased one. Meanwhile 22% said they considered a battery electric vehicle but only 5% bought one.

Intent, however, is growing. In the study, 40% said they plan to own an electric car within the next five years and 60% said they’d make the switch within the next decade. That compares with 30% and 52% respectively in last year’s study.

Interest in plug-in hybrid vehicles is also increasing with 36% saying they expect to purchase one in the next five years, up from 26% last year, and 47%, in the next 10, up from 37% in 2021.

Truck owners are notoriously loyal to what they’ve always driven but the survey reveals a slight crack in that intransigence with 28% of truck owners saying they plan to go electric in the next five years while 43% responding they’d probably make the switch within 10.

What’s keeping the rest from getting serious about giving up gas for electric? Howerter says it’s the usual concerns over battery range, recharging station availability and recharging speed.

“Buyers say one of the most impactful things the industry could do is just put more charging stations available in their area,” said Howerter. “They see them in their routine places like the grocery store. They picture what it would be like day to day to have an EV. That would go a long way in terms of adoption.”

Regardless of powertrain, when it’s time to dump the old ride for something new, the top method remains the old standby of trading it in at a dealership because it’s easiest to sell and buy in one place.

Overall, 50% of those responding said they sold their last vehicle at a dealership while 28% did so online and 23% sold to a private party. But 80% said they were open to selling online while instant cash offers to spark a sale were becoming more popular on and offline.

Why do consumers decide to buy a new vehicle? The top reason cited in the survey was for an “upgrade.” But Howerter says having to deal with the sacrifices brought on by the pandemic may just have folks looking to reward themselves just a bit, declaring, “A fair amount of people are saying they’re just ready for something new or ready to treat themselves.”

Advertisement

Leave a Reply

Your email address will not be published.