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Badge snobs may be a dying breed, according to data from a leading electric car rental company.
Octopus Electric Vehicles, part of the Octopus Energy Group, found that one in five customers who opted for a transition model while waiting for delivery of their preferred model from a competing brand chose to keep it and found it exceeded their biases.
Automakers are finding that the introduction of electric vehicles has attracted drivers from competing brands: a practice known in the industry as “conquest.” High-end electric models have been particularly successful in attracting former customers away from their usual brands, with Kia and Hyundai reporting customers switching from German premium brands to them.
In March, North American auto industry analyst HIS Markit released its 26th annual Auto Loyalty Awards based on data from 13.4 million new retail vehicle registrations in the United States. Tesla won the top conquer percentage category for the third year in a row, with the U.S. electric car maker poaching 22 percent of qualifying sales in the segment it competes in.
At the same time, some automakers have created new, dedicated sub-brands with little to no stamp of approval, which can make it a challenge to lure car buyers away from more established brands. Examples include Polestar, which was spun off from Volvo and is part of Chinese conglomerate Geely, and Genesis, which is part of Hyundai Motor Group.
Founded in April 2021, Octopus Electric Vehicles found that customers who decide to try a brand for the first time while waiting for their preferred brand are often pleasantly surprised.
“People are less interested in the badge than they are in a typical ICE (internal combustion engine) car,” said Oliver Boots, sales and marketing director. “They are more accepting of the newer Electric Vehicle entrants than maybe they would have been before.”
Fiona Howarth, Octopus Electric Vehicle’s CEO, said customers who have decided to stick with their interim car did so off their own bat: “They proactively asked us for that; we didn’t prompt them. I think if we prompt them it would be even higher.”
Boots believes as many as 40% of customers with interim cars would stick with them if they were asked if they’d be happy to do so.
A global semiconductor shortage has increased wait times for new vehicles, meaning private buyers who order a model today have to wait anywhere from four months to two years for delivery, depending on model and specification; Octopus Electric Vehicle claims the average wait time is now 43 weeks.
“Our customers aren’t waiting factory order lead times because we pre-order them,” said Howarth. “We have more like a four- to six-month waiting list, on average, but that includes everything from ones we can get in the next few weeks through to some that are 18 to 24 months.”
Boots said that if a car is ordered on the Octopus Electric Vehicle website with a long wait time, an “Electric Vehicle expert” will contact the customer to suggest a range of alternatives for faster arrival.
“It might be that we say, ‘Actually, we could give you this Kia e-Niro tomorrow, or we can get you a Polestar in a month.’ And either way, that sees you through,” said Howarth.
Electric vehicles listed on the company’s rental platform include the MG ZS Electric Vehicle, Mercedes EQA, Kia e-Niro, Audi e-tron, Cupra Born, Porsche Taycan and BMW i4, with the most popular model currently being the Tesla model.
The Taycan has the longest wait times of up to two years, which is why these customers often opt for transition vehicles. The models offered by Octopus are usually the Kia e-Niro, Mercedes EQA or Polestar 2, “usually because they are available cars”.
Boots said: “People don’t tend to go from Porsche to Kia but there was one customer who did [opt for an interim Kia] when I think it was an Audi e-tron they were waiting for, and there are some people who are making a few jumps and are very happy.”
Howarth believes that the ability to mass produce cars will lead to the long-term success of Electric Vehicle brands; more than the quality of the cars. She compared the situation to VHS versus Betamax.
“The winners in Electric Vehicles in the next few years will be the companies that have supply of cars,” she said. “With VHS vs Betamax it wasn’t about what tech was the best, it was absolutely about their ability to manufacture at scale.
“They won the race by basically dominating the market and having supply and I absolutely see that right now with EVs; those that have supply are winning customers because there is such a huge shortage.
“And when people switch brands, they create relationships and loyalties with those new brands that they’re getting into, most likely for the longer term.”
This week, Octopus Electric Vehicles announced a new bundle for UK and US customers, which includes the car, the Ohme Home Pro smart wallbox charger, the AA breakdown cover and the Octopus Smart Energy Plan.
Intelligent Octopus tracks national energy usage and only charges cars at the most convenient times to reduce consumer costs and balance the national grid. It includes off-peak rates of just 7.5p per kWh for six hours between 11.30pm and 5.30am.
Drivers will also receive 5,000 miles of free energy on tariffs to charge at home or through Octopus’ Electric Juice Network, which has access to 250,000 chargers across Europe, if that’s not possible.
The company claims UK drivers can save up to £3,775 on fuel bills on a three-year lease compared to an equivalent petrol car.
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