According to analyst firm BloombergNEF, just over half of the passenger cars sold in the US will be electric vehicles by 2030. This growth is spurred by actions taken by the White House and Congress through the newly enacted infrastructure law. Legislative steps in California to adopt clean air standards will likely be supported by several additional states within the next five years. And finally, every major automotive manufacturer in the US have announced plans to accelerate production of battery electric vehicles (BEV), with many planning to eliminate the sale of internal combustion engine vehicles by 2050.
Clearly, BEVs are coming and more quickly than anticipated. Many dealers already have a smattering of these vehicles on their lots or are taking orders through their digital platforms. But, preparing to broadly support these new vehicles requires more than simply installing a charging station and creating some sales tools. Understanding the complete BEV infrastructure, means taking a deep dive into its impact on the physical lot, the service department and overhead expense.
Rather than being overwhelmed by the breadth and depth of these changes, savvy dealers will find the opportunities to derive more value – and revenue – by taking a strategic approach to implementing a BEV infrastructure. Upgrading the dealership in a planned, deliberate manner will deliver a competitive edge and a satisfied customer. Let’s break down the opportunities to generate revenue through purposeful infrastructure improvements.
Inventory and service bay modifications
Housing BEVs on a dealer lot will require some modifications – especially if those units will be outside. Beyond the installation of EV charging stations, dealers should consider their strategic placement. Stations should be considered multi-purpose – for both the dealer needs as well as consumer use. Installing multiple charging stations throughout the lot might be the best solution, but also factor in the permitting, utility cost, and access. BEVs housed outside should also be under some form of cover to prevent heat-related battery degradation.
While BEVs still require traditional physical repairs on many wear items in the drivetrain, many of the components have special requirements and technicians need access to upgraded electrical and internet resources. Investigate the electrical and high-speed data access footprint for each service bay, including wattage, amperage, and outlet layout. Additionally, some BEVs require a larger service bay overall, which can make retrofitting your current bay setup to accommodate these vehicles more challenging.
Of course, all these changes have a sticker price which can look daunting. However, there are several ways to reduce your overall cost to upgrade your dealership. Work with your the local utility and internet provider to understand upgrade options – as well as any potential subsidies available. Also, many states offer grants to businesses for this very purpose.
You can find all subsidies related to EV infrastructure upgrades here: https://afdc.energy.gov/laws/search
Simply search by your state to see what subsidies are available for you.
Offsetting Your Infrastructure Overhead
These changes will certainly impact overhead expense, but there are options to generate revenue that can offset some of the costs. Consider unique business propositions such as an EV charging subscription model for customers that includes concierge services such as work stations with high speed connectivity. Launch a Zip code campaign to offer charging services to neighbors – and gain a new customer as well.
EFG Companies is here to help guide our dealer clients through their entry into the world of BEVs. We bring a wealth of industry expertise and business acumen to drive value for our customers. Our award-winning client engagement model can help you secure and support every BEV sale. We’re not just your F&I provider – we are your business partner.
Contact us today to learn more about our profitable solutions that can drive success for your business in 2022.