If you're going into the electric vehicle business, beware of flying monkey wrenches.
The issue is loyalty -- or, in the case of EV customers, the lack of it, according to the automotive information company Edmunds.
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The firm's 2023 EV survey found that 85% of EV car shoppers said they were open to buying an EV from an auto manufacturer they do not or have not owned.
“Traditionally, automakers count on consumer loyalty to carry their sales rates, but consumer interest in EVs combined with the limited number of options in the market is spurring shoppers to consider taking the wheel of brands they’ve never driven,” Jessica Caldwell, Edmunds’ executive director of insights, said in a statement.
Throwing a 'Monkey Wrench'
In the first quarter of the year, Edmunds said, 63% of all EV sales with a trade-in were of a brand different from the brand of the trade-in.
While this figure is shifting lower quarter over quarter as more mainstream automakers enter the EV arena, Edmunds said there is still a significantly higher percentage of consumers willing to shift brands when compared with the industry at large.
Fifty-one percent of all vehicle purchases in the first quarter with a trade-in had a trade-in of the same make.
"EVs are throwing a monkey wrench into the loyalty patterns that automakers have grown accustomed to," Caldwell said.
Caldwell added that 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.”
Edmunds said that some automakers aren't taking advantage of elevated consumer trust in their brands to get ahead in the EV race.
The study found that the top five brands' consumers trust to make the best EV are Tesla (TSLA), BMW (BMWYY) , Toyota (TM), General Motors' (GM) Chevrolet and Audi (AUDVF) .
Nomads & Loyalists
Notably, only Tesla and Chevrolet reside within the top five EV sellers by volume as of the first quarter, Edmunds said.
Customer loyalty was also the subject of a survey by S&P Global Mobility early this year which found that most automotive customers who are new to a brand often leave for another brand when they return to market.
S&P said that more than half of these so-called "Nomads" make a habit of this kind of behavior.
Nomads who own a brand once and leave are also known as "One and Done." Roughly 58% of Nomads left their brand in the 12 months ending July 2022, the highest "One and Done" rate in 10 years, S&P said.
Super Loyalists, S&P said, are consumers with a history of multiple repeat purchases and are most likely to repurchase from the same brand and Loyalists are consumers with a repeat purchase.
"While Tesla's high share of first-time owners (83%) isn't too surprising, their ability to keep those new customers is extraordinary," the S&P report said. "Tesla's 'One and Done' rate is just 39% compared to 58% for the industry."
