Buying a new car shouldn't be difficult, but we live in a time where interest in new platforms is gauged by reservations and traditional car buying is still plagued by dealer markups. According to a new study from Cox Automotive, one solution to car-buying woes is to buy an EV. And it looks like GM is a big target for those EV pickup buyers.
Welcome to Critical Materials, your daily dose of all things electrified and automotive tech. In today's roundup, we're talking about car buying. Specifically, that GM says it has 100,000 reservations for its battery-electric pickups, EV buyers report higher satisfaction in car shopping than ICE buyers, and Stellantis dealerships are rushing to ready for new EVs.
30%: GM has 100,000 reservations for battery-electric pickups
General Motors might be back-peddling a bit in its fast-paced transition to battery-electric after dealerships told the automakers that consumers want hybrids, but that doesn't mean that the public has lost interest. In fact, it's quite the opposite.
During GM's year-end earnings call, CEO Mary Barra revealed that the automaker has 100,000 reservations and orders for EV pickups.
100,000 reservations and orders is a lot, but to be clear, this number is a bit muddied when compared to the Tesla Cybertruck's estimated one million (or more) reservations, as it really represents a figure calculated across all models of all GM child brands. That means the Chevrolet Silverado EV, GMC Sierra EV, and Hummer EV are all included in this number.
Presently, GM's electrified offerings are limited to the Cadillac Lyriq, Chevrolet Blazer EV, Chevy Silverado EV Work Truck, and GMC Hummer EV (pickup and SUV). Barra says that the Chevy Equinox EV, Silverado EV RST, GMC Sierra EV Denali, and Cadillac Escalade IQ will all arrive in dealer showrooms this year, meaning that the brand intends to strengthen its EV push moving forward.
Given recent dealership feedback, Barra also made it clear that it has the flexibility to pivot back towards ICE-powered vehicles if the market demands it:
[I]f demand conditions change, we'll take advantage of our manufacturing flexibility in Spring Hill and Ramos to build more ICE models and fewer EVs. We can also mix between different EV products at Factory ZERO. Ultimately, we will follow the customer. The supply chain, manufacturing, and software changes we have made will support our growth.
It would appear that GM fully intends to push forward with EVs, including battery-powered pickups. But does GM anticipate potential customer push back? It's clear that the range of EV pickups is rather lackluster when towing, especially in cold weather, meaning that some would-be pickup buyers may reconsider their order based on their needs—and that goes for all brands, not just GM.
For those who do stick with their orders, however, Barra says that GM intends to fill its EV pickup order backlog through the 2024 and 2025 calendar years.
60%: Shopping for an EV is more enjoyable than an ICE vehicle: Survey
The car buying experience has changed drastically over the last few years. Automakers have been looking to pivot towards direct sales, at least where not limited by existing dealership laws, and that has led to a shift in the way people shop around for their next vehicle.
A new study by Cox has found that people are actually pretty dang satisfied with the car buying process these days. In fact, the overall experience left 69% of buyers highly satisfied—that's up 8% from 2022. But the most pleased were those purchasing a brand-new EV.
More specifically, EV buyers were satisfied with the amount of time it took to purchase a car. New EV buyers spent just 11 hours from start to finish, something which left 76% of buyers highly satisfied. Meanwhile, only 59% of ICE buyers were satisfied with the average duration it took them to purchase a new vehicle, which was just over one hour longer than the average EV transaction.
69% EV buyers used an omni-channel buying approach which combines the online buying experience with at-dealership activities. Comparatively, only 39% of ICE buyers took this approach.
When choosing whether or not to buy the car completely online or at a dealership, EV buyers appear to be split. 16% of new EV buyers completed the process entirely online, versus 15% of EV buyers who do every step of their purchase in person.
Those who took the hybrid approach very much valued the ability to pick up in-store where they left off online, as well as having consistent information across the buying experience.
90%: Stellantis dealerships are cramming for the imminent EV arrival
Stellantis is bringing its EVs to the streets this year whether or not the world is ready for them. Its dealers, however, will be. That's the goal, at least.
The automaker is currently pushing out a wide array of training to its dealer network to ensure that its salespeople, techs, and everyone in between are ready to sell and service its new generation of battery-electric vehicles. For 2024, that means the Ram 1500 REV, Dodge Charger, Jeep Recon, and Jeep Wagoneer S.
The dealers who opt into selling these EVs are in the process of undergoing rigorous training within Stellantis' "system." This includes setting up charging infrastructure, training employees on sales strategies, and ensuring staff is aware of operational changes. After all, for the average buyer, moving from a gas-powered car to an EV is a big shift.
CEO Carlos Tavares has been fairly vocal about the shift to EVs being a difficult one for the company. Moreover, he noted that the company projects a "sweet spot" of EV pricing to be around $25,000, which would also require the company to eat a significant amount of additional costs compared to traditional ICE-powered cars.
We have a lot of work to do, and we are doing that work in terms of reducing the costs because, as you know well, imposing EVs means imposing to companies like ours to digest 40 percent of additional cost compared to [internal combustion engine vehicles] in a few years.
Because you can always do the price that people would like to pay with red numbers, but then you put your company at risk, which is not my style. Everything we sell, we make profit out of it
The work noted by Tavares isn't just exclusive to its headquarters in Detroit. It's also an investment to be made by its dealer network, which is something this newest round of training is anticipated to help with. And if the dealers want to be part of a profitable and successful move to electrification, this is merely the first step.
100%: How was your last car buying and after-sales experience?
Buying a new car can be either a great experience or a terrible one. I've cycled through four new cars in my household since 2020, and two of those have been purchases that did not involve dealing with a salesperson. To say the least, that was pretty enjoyable, except when it came to having to learn certain features about my car on my own when it was time to pick it up.
That being said, the after-sales experience has been hit or miss for a lot of people who have purchased the same brand vehicle as me. And I've heard horror stories about EV buyers of different brands navigating the dealership model when the dealers weren't fully acclimated with EVs.
All of that being said—I want to hear about your most recent car-buying experience. How did it go, and how has the after-sales experience been?