The Expert Podcast

For many years, Tesla and Prius were the two names people thought of when it came to an electric vehicle. Those were the two cars that were famous for EVs. As the electric vehicle market becomes more mature, every manufacturer now has electric vehicles. Ford, Volvo, Chrysler—all have electric vehicles now.

In the past, people always gravitated to one brand and stuck with it. For instance, a Ford family bought a lot of Fords or Subarus. However, electric vehicles may not have the same type of brand loyalty. The reason why is because the engine, transmission, and styling are a little more of a commodity with electric vehicles.

Most people, when they bought a vehicle, liked the styling of, say, a Ford or a Chrysler, or they liked the engine that was in it. People liked that same platform. Nowadays, electric vehicles are a lot more similar to one another. It's almost like a commodity. The engine doesn't exist—it's an electric motor—so nobody really cares about the mechanics of the vehicle.

For that reason, as noted in this Wall Street Journal article, brand loyalty may not be a thing anymore. It used to be that Toyota could count on a lot of brand loyalty, so could Subaru. But as electric vehicles become more ubiquitous and more people own them, the factories may not be able to count on that loyalty. It may not be a "Toyota family" anymore.

Early results from actual sales are showing that. For example, Rivian, which makes the new electric truck, is seeing a wide spectrum of car buyers. Some own thirty-thousand-dollar Subarus, and some own hundred-thousand-dollar Porsches.

The same thing is happening with Galpin Motors, which owns one of the biggest Ford dealerships that sell electric vehicles. They're seeing trade-ins from everything—BMWs to commuter cars to trucks—buying electric vehicles. Part of the reason is that some brands don't have electric vehicles yet or a wide range.

There's a limited window to pursue EV buyers because selection remains narrow, leaving some EV buyers with little choice but to explore other brands. Their brand may not have a good electric vehicle. Auto executives are recognizing this. It's a bit unnatural right now with the market not filled in.

Historically, automakers counted on loyalty to protect market share. On average, about half the people who owned a brand returned to buy another one of that brand. But the electric vehicle transition makes for an opportunity. EV buyers are willing to broaden their searches because of slim availability across the industry.

So, if you own Chevrolets but the Chevy dealer doesn't have an electric vehicle, you might have to look at a Ford, Tesla, or Prius. Electric vehicle disruption is disrupting more than just the type of vehicle—it's disrupting the brands that people are considering.