How Will Electric Vehicles (EVs) Transform the Current Auto Market?
repost from: SuperSpark
SuperSpark: THE BIG QUESTION: What will the impact of EV’s be on the existing car market?
Brian from Benoni writes, “I know it is premature to ask, but I am new to the industry and would like know how to prepare for the changes trading in used EVs will cause.”
It is never too early to start preparing for something that will bring major change to the way we do business.
It's challenging to predict an exact timeline for the phase-out of used ICE (internal combustion engine) vehicles in South Africa, as it depends on multiple interconnected factors. Government and industry stakeholders will need to work together to establish clear policies and incentives to facilitate the transition to electric mobility.
Additionally, public awareness and education about the benefits of EVs will be essential in driving consumer adoption and accelerating the phase-out of ICE vehicles.
It is premature to provide you with hard and fast rules, as these will evolve as the sales of EVs start growing, but I am going to do my utmost best:
Keep up to date with changes within the EV environment as the technology evolves on a daily basis. Especially development within the battery environment.
Closely monitor market trends and consumer preferences related to EVs to make informed purchasing decisions and adjust pricing strategies accordingly.
Dealerships will likely need to diversify their stockholding to include a mix of traditional vehicles and EVs. This ensures they can cater to a wider range of customers with varying preferences and needs.
The pace of the phase-out will also depend on consumer demand for EVs. If consumers show a strong preference for EVs due to factors like lower operating costs and environmental concerns, the transition could happen more quickly.
Providing excellent after-sales service and support for EVs will be crucial in building trust and loyalty among customers, especially as EV technology continues to evolve.
Initially, the influx of used EVs could lead to a decrease in prices for older models as supply outpaces demand. However, as EV technology improves, and consumer trust in the longevity of batteries grows, prices may stabilise or even increase.
The depreciation rate of EVs compared to traditional ICE vehicles may differ. Currently, some studies suggest that EVs may depreciate at a slightly higher rate than traditional cars, although this could change as the market evolves.
Offering flexible financing and leasing options tailored to the unique characteristics of EVs, such as potential battery replacements, could become a competitive advantage. Toyota has developed a solid-state battery for electric cars that can produce up to 1200 kilometres of driving range and charge in only 10 minutes.
One of the advantages of EVs is that they have fewer moving parts compared to traditional vehicles. This can lead to lower maintenance and repair costs, which could make used EVs more attractive to buyers. My big concern here would be whether we have a sufficient amount of qualified technicians to deliver quality aftersales and repairs.
Make sure you have access to enough home docking stations to sell as most of the used EV buyers will be first-time buyers and would want to install them at home. This goes for the dealership as well.
It's challenging to predict an exact timeline for the phase-out of used ICE vehicles in South Africa as it depends on multiple interconnected factors. The only thing I am sure of is that a total phase-out will not happen in my lifetime.
Thank you, Brian, for your interesting question.