Electric vehicle customers are highly likely to consider new brands when shopping for a product, according to an Edmunds study on brand loyalty in the EV market.
In its 2023 EV sentiment survey, the research firm found that 85% of EV consumers would consider purchasing from a brand they have never bought from. Jessica Caldwell, executive director of insights at Edmunds, noted that this trend challenges the norm car manufacturers are used to. “Traditionally, automakers count on consumer loyalty to carry their sales rates…” she writes. “EVs are throwing a monkey wrench into the loyalty patterns that automakers have grown accustomed to, and it will be fascinating to watch if the growing number of EV models from mainstream brands will shift consumers back fully toward their loyalty tendencies or if brand allegiances are a thing of the past.”
Brand loyalty remains a complicated facet of automotive marketing, both in and outside the EV space. Last year, brand and manufacturer loyalty dropped to their lowest points, 49.4% and 55.9% respectively, in three years, according to data from S&P Global. While gas-powered vehicles already struggle to find dedicated audiences, their all-electric counterparts complicate the matter even more. In 2022, Tyson Jominy, J.D. Power vice president of data and analytics, noted that EVs threatened to upend the already weakened status quo: “There is an element of risk to brand loyalty that could erode for those sitting on the sidelines or not moving quickly enough.”
The Edmunds study underscores how the problem has evolved in 2023. High EV prices, rising inflation, credit tightening and interest rate hikes have reduced the number of options customers have on the market. OEMs looking to boost brand loyalty are likely to face an uphill battle so long as these issues persist.