Even though the market is better than it has been in years, high interest rates and the election are making buyers nervous
The auto industry has been slowly recovering ever since the pandemic hit, and these days, things are better than they have been in years. Inventory is up, and so are the incentives. You may still struggle to get a good deal on some of the most in-demand models, but overall, the seller’s market that sent prices through the roof during COVID is a thing of the past. Still, Autoweek reports that consumers remain nervous about pulling the trigger on a new car.
Research done by Cox Automotive suggests that high interest rates are a major factor in people’s decision to hold off on buying a new car, and they’re also worried about the economy, especially with the election coming up in November. Unfortunately, whether the perception that the economy is in trouble is legitimate or not, if people are convinced it’s real, that’s going to impact their spending decisions.
Interestingly, among the people surveyed, most said their powertrain choice was unlikely to be affected by whoever wins in November. So even if we end up cursed with a second Trump administration that’s hostile to EVs, that’s not going to change the minds of people who have already decided they want an EV. Cox also projects that we’ll see a significant increase EV interest over the next several years. By 2028, it believes 79 percent of new car buyers will consider buying an EV, up from 44 percent currently.
EV supply is also still higher than ICE supply, with an average inventory of 104 days for the former and 73 days for the latter. If you’re looking for a deal on an EV, Cox recommends looking at Volvo, which has far and away the largest EV inventory of 190 days. If anyone’s going to be ready to make a deal, it’s probably going to be a Volvo dealer. Chevrolet, Audi, Mercedes-Benz and Ford $F round out the top five in descending order.
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