With acceptance at an all-time high, it appears that electric vehicles (EVs) are finally coming into their own. Automakers have come a long way in ironing out many of the logistics and design issues that have plagued the category for so long. Concerns around range anxiety, vehicle pricing, and battery life are waning. As a result, there’s genuine enthusiasm around the technology among mainstream buyers. And while EV sales make up only 6% of total vehicles, demand is rapidly growing. In fact, sales are expected to reach 17% by 2025 — and 30% by 20301. That means a third of all dealer inventory will be electric in just seven years.
That may seem like a lot of time to prepare, but dealership electrification takes time, especially with a changing customer base.
A third of all dealer inventory will be electric in just seven years.
As EVs have become more mainstream, so have EV buyers. Traditionally, EV early adopters have been younger, wealthier risk-takers who embrace new technology and need little or no education from the dealer. But this demographic is quickly shrinking and being replaced by mainstream buyers who are motivated by decreasing price points and generous government incentives. They stress utility and practicality. They’re cautious and need extensive education to get to the finish line. The good news is that this presents an opportunity for dealers to add value to their business by becoming the authority that customers turn to for EV answers, products, and services.
It takes focus, investment, and expertise to become a great EV dealership. Dealers can position themselves for success in the EV age in three important ways.
Source: Business-to-you, Crossing the chasm in the tech adoption lifecycle
Develop EV Expertise Above and Beyond the Vehicle Itself
In a recent survey conducted by Plug In America, 83% of owners and prospective owners were satisfied with finding the information they needed to buy an EV on their own. And, only 15% of EV owners rated dealership salesperson knowledge as very high2.
To counter this, dealers need to become the consummate expert on electric vehicles. And not just in the usual areas like battery range, but beyond the vehicle to complex topics like home charging infrastructure, tax rebates, and policy. By providing guidance on these issues at the time of purchase, dealers can help avoid many common pitfalls experienced by new owners. This may seem like extra work and responsibility for the dealership up front. But getting the EV customer experience right means being able to move inventory at scale and having repeat customers in the future.
Getting the EV customer experience right means being able to move inventory at scale and having repeat customers in the future.
Provide EV-Relevant Products and Services
One of the most common mistakes dealers make is failing to customize their products and services to electric vehicles. Trying to pass off existing solutions as “good enough” for EVs won’t work. It’s like putting a square peg in a round hole. That’s because EVs are genuinely different. Take, for example, EV service contracts. Traditional service contracts don’t cover EV parts like the all-important battery. And, since EVs are made and wear differently, they require different coverage considerations. The purchase path is also different for EVs. Newer, mainstream buyers need far more education and guidance. This means having highly personalized needs-based selling techniques that are attuned to their needs, expectations, and objections. Having an EV-specific needs-based analysis can go a long way in making sure your team and your marketing materials are on point.
High-quality omnichannel training is also important here. EV-specific training can prepare every area of the dealership for the nuances they’ll face in the coming years. So they can deliver a seamless customer experience on par with premium EV brands like Tesla.
One of the most common mistakes dealers make is failing to customize their products and services to electric vehicles.
Support an EV Ecosystem Where your Customers can Live — and Thrive
In an increasingly connected world, dealers will reach farther into customers’ lives than ever before. Through in-home EV charging equipment, integration with mobile devices, home entertainment, and security systems. The experience will all be interconnected, increasing convenience and productivity.
Dealerships that can help their customers understand and integrate into this ecosystem will be able to stay connected to their customers throughout the lifecycle of the vehicle. But exactly how can dealerships help their client navigate this new ecosystem? The answer, not surprisingly, is through innovation.
Take EV home charging, if consumers don’t mind their EV taking up to 20 hours to charge, it won’t cost them anything extra — they can plug their EV into a standard 120-volt power outlet. However, if they want something more practical, they will need that Level 2 charger installed at their home. The cost to install one of these charging stations varies depending on the type of home and where the charger will be installed. Recent reports show that on average, the total cost of installation was approximately $3,800. Innovative partnerships can be leveraged to drive down the average cost of installation and provide a solution where EV buyers can enjoy a great experience and understand what could be a large, unexpected expense if it goes unaddressed at point of sale.
In an increasingly connected world, dealers will reach farther into their customers’ lives than ever before.
Looking Ahead: EV Profitability Around the Corner
The EV revolution is accelerating, with a third of dealer inventory expected to be electric by 2030. Now is the time for dealers to prepare for what will be a significant shift in dealership operations. Dealers can prepare by developing deep technology expertise, building EV-specific solutions, and by supporting an EV ecosystem that keeps them connected. Continuing to treat EVs just like any other vehicle purchase will not have any major sales ramifications today, but it will down the road. EV Buyers want a sales experience that directly acknowledges that their purchase is unique and different. It’s highly likely that most EV buyers who arrive at dealerships in the next decade will be first-time buyers who truly need varying levels of support. Don’t undermine your position by using sales methods and products that barely acknowledge the existence of EVs.
At Assurant, we’re helping our partners prepare with a range of EV-centric products and services like Assurant EV One Protection, an innovative service contract. We’re also providing specialized needs-based training and marketing tools that will help dealers deliver a customer experience tailored to EV buyers.
Those dealers that prepare now will stand to reap substantial growth and profit in the EV age. And they will be successful in delivering the modern products and services their customers want.
Wondering where your business is in the evolution to electrification? The experts at Assurant can provide a needs-based EV-specific analysis at your dealership. Contact us today.
- Sources: EVAdoption, EEI
- Plug In America’s 2022 Survey report