Compiled / Zhu Lin
Editor/Linyu Zhang
Design / Leather
Source/CNBC, by Michael Wayland
When the Russo-Ukrainian war pushed gasoline prices to historic highs, consumers who wanted to switch to pure electric or more fuel-efficient cars were not so easily fulfilled.
The combination of supply chain issues, pent-up demand and record-low car inventory levels means that many new cars, including electric vehicles, are snapped up before they reach dealers.
Those off-the-shelf cars tend to be large pickups, SUVs and crossovers, as many automakers have abandoned the production of small cars in recent years or made it a non-priority in exchange for higher profit margins.
"Even if they want to switch to electric cars, they don't have a choice." Jessica Caldwell, executive director of insight at Edmunds, said.
"Anything you want to buy, you need to wait. Even if you want to lower your purchase target, pay the highest price. There is no point in acting now. ”
Gasoline prices have soared since Russia went to war with Ukraine on Feb. 24. According to the American Automobile Association, the average price of gasoline per gallon in the United States is $4.06, up 45 cents in a week, $1.30 more than a year ago. The U.S. and other Western countries have reacted by sanctioning Russia, including banning or reducing Russian oil imports.
At the same time, customers will face months or even years of waiting times when buying an electric vehicle. First-class models are easier to buy, but there are few discounts now.
Morgan Stanley analyst Adam Jonas wrote in a note to investors on March 9: "Electric cars are certainly good, as long as you can find them and afford them." ”
According to Cox Motor Company, U.S. auto inventory levels are about 1.1 million units, down about 60 percent from a year ago and 70 percent from 2020. As of Feb. 21, there were only about 25,100 electric and hybrid vehicles, or 2.4 percent of that total supply.
Michelle Krebs, executive analyst at Cox Motor Company, said, "If your plan is to switch to electric cars, hybrids or even small cars, good luck, there's not much you can buy." ”
Cox reports that among the most readily available vehicles are the Ram 1500, Chevrolet Silverado pickup, Jeep Grand Cherokee LUV, Mazda CX-5, and Ford Escape crossover. The least likely to buy are kia Telluride, Subaru Forester SUVs, Honda Civic, and Toyota Corolla sedans.
With supply chain disruptions and parts shortages already wreaking havoc on the auto industry for more than a year, automakers have shifted their production focus to high-demand and high-margin trucks and SUVs.
And with Russia and Ukraine still in conflict, these problems are expected to escalate, so many automakers are basically selling as much as they can.
Jay Joseph, vice president of marketing and customer experience at Honda Motor Company, said, "People will buy what they can get. Without inventory, people have no choice but to passively accept. ”
Joseph said about 60 percent of Honda cars were sold before they reached the dealership. Before the recent inventory cut, about 75 percent of Honda's vehicle sales were on-site at dealerships, he said.
Industry experts expect that even if oil prices reach record levels, they will not spur Americans to change the long term in their driving decisions. If anything, it's that a spike in oil prices could change the number of times they choose to drive, at least until oil prices stabilize at a lower level.
"What we're seeing is only a temporary shift." Joseph said, "In the long run, Americans are very adaptable to oil prices." It depends on how long oil prices stay high and how long they stay that way. ”