Car Dealers Biggest Barrier To EV Sales

A new study by Eric Cahill for the Institute of  Transportation Studies at the University of California at Davis says the biggest reason there EV sales aren’t higher is that traditional car dealers don’t want to sell them. Margins on the cars are razor thin, so there is little direct profit to be made. To make matters worse, EVs need less routine maintenance and fewer repairs. Some dealers survive on the money their service and parts departments earn, according to the New York Times.

Most dealers try to sell their EVs the same way they would a Corolla or a Civic. They don’t want to be bothered educating the customer about electric or plug-in hybrids. They are there to sell cars, not give seminars. Salesmen see EV customers as a waste of their time. A good salesman can sell three cars in the time it takes to sell one EV.

So many questions! How do I charge my car? Where are there chargers in the area? What is regenerative braking? Why do I get less range in winter? What does “pre-conditioning” mean? What sort of wall charger should I get for my home? How much does it cost to charge this car? How long does charging take? How long will the battery last? A conventional car buyer doesn’t need to ask all those questions. They only need to pick a color and a few options and then its straight on into the finance office for a few signatures before driving off the lot in that new jewel.

Some EV shoppers report that dealerships are doing such a poor job of training their sales staff, the customers often know more about the cars than the salespeople do. Others say they have felt pressured to buy a conventional car instead of an EV. Clearly, if the electric car revolution is every going to happen, dealers will have to be dragged kicking and screaming into the 21st Century. Eric Cahill calls car dealers a “bottleneck” on the way to greater EV sales.

Tesla and Elon Musk should use this information when they try to get individual states to pass laws that allow direct sales to customers, bypassing traditional dealers. Despite all the protestations from dealer groups about how valuable the franchise dealer model is, the truth is that franchise laws do nothing but protect the financial interests of a small group of business owners. They preserve a process that is the antithesis of the free market that all Americans say they favor.

Regulators can force manufacturers to build cars that get better fuel economy or pollute less, but no regulations can force car dealers to sell them. Until that conundrum gets resolved, the promise of a fossil fuel free future will continue to be delayed.