Evaluating the Potential Impact of Low Sales on the EV Market
As the electric vehicle (EV) market gains traction, there are questions regarding the future of EVs in the face of low sales. In this episode of Inside Automotive, Kevin Tynan, senior automotive analyst for Bloomberg Intelligence, sheds light on the latest production and delivery data from EV companies.
Top Stories Despite strong overall auto sales, new-vehicle supply in March reached its highest level in two years, but this may not be sufficient to bring prices down. J.D. Power predicts a 9.8% improvement in new-vehicle sales in April compared to the previous year, even as prices hit record levels. The forecast indicates a total of 1.32 million new car sales, with a 45% increase in retail inventory. While average transaction prices are expected to rise by 2%, consumer spending on new cars is set to reach $47.5 billion by the end of the month, according to Thomas King, president of the data and analytics division at J.D. Power.
Mercedes-Benz Mercedes-Benz reported strong results for the first quarter, just two days after exiting the Russian market. The carmaker experienced an 8% year-over-year revenue growth driven by over 600,000 vehicle sales across its divisions. The top-end car and premium van segments showed moderate growth, while electric vehicle deliveries nearly doubled compared to the previous year. The brand experienced robust demand in the U.S. and China but acknowledged sluggish European activities.
Stellantis During a visit to a Stellantis facility in France, CEO Carlos Tavares dismissed the idea of engaging in a price war with Tesla. Tavares stated that such a strategy would be impractical, as it would hinder the company’s goal of doubling revenues over the next seven years. While Tesla has implemented seven price cuts since January, Tavares emphasized that Stellantis prioritizes growth over profitability. If market prices were to decline, the automaker would adapt by reducing costs to maintain margins above 10%.
Inflation Recent reports indicate a continued rise in inflation, slightly surpassing economic forecasts in March. Annual inflation increased by 4.6%, driven by rising costs of goods and services. Although there was some relief in food and energy prices, consumers remained cautious in their spending habits, despite slight income growth. The Federal Reserve has suggested that additional interest rate hikes are likely if inflation continues to rise.
For Dealers Training for competition in car sales Competition for sales is making a comeback, prompting the need for well-prepared sales staff. While U.S. new-vehicle inventory levels rose in December, affordability concerns have led shoppers to consider used vehicles and explore more dealerships for better prices. To navigate these challenges, dealerships should focus on equipping their sales staff with the necessary skills to excel in a competitive market.
Choosing the right EV charging equipment for auto dealerships As electric vehicles become more prevalent, automakers are requiring EV-selling dealerships to install charging equipment. By partnering with knowledgeable experts like Blink Charging, dealerships can efficiently select the appropriate charging equipment to future-proof their facilities for years to come, considering the increasing demand for EVs from customers.