Group Buying Can Slash EV Purchase Prices

Here’s an idea from a group in Colorado that can drive down the high cost of buying an EV. SWEEP, the SouthWest Energy Efficiency Program, reports that communities that negotiate volume discounts with local dealers can slash the price of an EV by many thousands of dollars. Combined with Federal and state incentives, that effectively reduced the price of a Nissan LEAF S from $29,860, including destination charges, to less than $13,000. Who wouldn’t buy a new LEAF for $13,000?

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To be fair, the State of Colorado has the most generous state EV incentive — $6.000. But even in a state with no electric car incentives, that means people interested in an electric car can buy one for a lot less than they could if they just walked into their local dealer alone, checkbook in hand.

Lower prices can significantly increase the number of electric cars within the community. According to SWEEP, a program sponsored by Adams, Boulder and Denver Counties, sold 248 Nissan LEAFs in 4 months. That’s more than  double sales for the entire prior year. Sales from this one program accounted for 5% of LEAF sales nationwide between September and December of 2015. A similar program in Fort Collins, Colorado Fort Collins, Colorado saw sales at the local Nissan dealership more than triple compared to the prior year. A third program in the Salt Lake City area sold 75 electric vehicles in just a six week period — double sales in the entire state of Utah for the same period the prior year.

There is another advantage to group sales. According to SWEEP, 72% of the people who participated in the multi-county program in Colorado had no intention of buying an EV until the savings offer changed their mind. That’s important. These programs are not just for those who are already in the market for an electric car. They expand the number of people who are willing to consider owing one.

SWEEP’s website says, “One of the…advantages of a group purchase program is that it is a very inexpensive, but high impact, program for a local agency to run. The local agency leverages the collective buying power of their constituents to negotiate a discount from private sector providers (the car dealers and auto companies) and then gets the word out to the community. For a very small outlay of staff time and money you can create a big impact in the community. For example, Boulder County invested only $7,000 in staff time and advertising costs while leveraging over $5 million in EV sales.”

SWEEP has put together a handbook for local groups that want to learn how to run similar programs. The secret is that many people working together can get more favorable terms than a bunch of individuals acting on their own. Would such a program work for cars other than the LEAF? There’s only one way to find out.

 

 

Steve Hanley

Closely following the transition from internal combustion to electricity. Whether it's cars, trucks, ships, or airplanes, sustainability is the key. Please follow me on Google + and Twitter.