Electric Vehicle Consumer AdoptionHow the Electrified Dealer Program Boosts EV Sales
July 13th, 2020
When the City of Columbus won the U.S. Department of Transportation’s Smart City Challenge in 2016, it became America’s Smart City with a very small electric vehicle (EV) market. Ohio’s lack of public incentives promoting EV ownership was a major factor in EVs making up just 0.37 percent of cars sold in the Columbus market that year.
Ohio’s low EV adoption rate may have helped Columbus win the $10 million Paul G. Allen Family Foundation grant, which accompanied the Smart City Challenge win, says Zach McGuire, EV and smart mobility adoption manager at Smart Columbus.
“The electric vehicle market was miniscule and I think having so much room to grow contributed to us winning the grant,” McGuire says.
The goals tied to the grant were aimed at decreasing carbon emissions by accelerating EV awareness, education and adoption. Creating change in the Columbus market would take several tactics, as the state of Ohio is not a state with zero emission vehicle (ZEV) policies or incentives in place in order to achieve the grant-funded goal of boosting the share of EVs sold in the Columbus region to 1.8 percent of sales by 2020, a nearly 500 percent increase.
The ZEV program is the nation’s largest initiative promoting EVs, starting in California in 1990. The ZEV program was originally a part of the Clean Air Act and allowed other states to follow the same requirements that California adopted. Since then, Colorado, Connecticut, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon, Rhode Island and Vermont have adopted a series of low-emissions standards to encourage EV purchases. The program is adopted by state governments and mandates that automakers sell a percentage EVs, which varies by state. The goal of the Multi-State ZEV Task Force, which aligns the 11 states, is to have 3.3 million EVs operating in the states by 2025.
Because automakers, or original equipment manufacturers (OEMs), are required to boost EV inventory and train dealerships on how to communicate about EVs in these states, they prioritize inventory to them to meet the state’s goals. These states, along with the OEMs, utilities and other EV and sustainability advocates provide a series of educational and awareness campaigns along with incentives to encourage EV adoption and widespread installation of charging infrastructure. As sales increase, so does public awareness and education, creating a positive feedback loop leading to the high rates of EV ownership seen in ZEV states today.
Understanding the Columbus Regional Market
To reach its electrification goal, Smart Columbus had to recreate the success of EV adoption programs found in ZEV states without the statewide policy support. We also had to encourage OEMs to bring inventory to Ohio, though the state lacked the market that made EVs so attractive to buy in ZEV states.
In 2016, as Smart Columbus was formed, only 18 models -- less than half of the EVs available on the market -- were sold in central Ohio. Only 70 EV chargers were reported in the seven-county region. This means residents were unlikely to see EVs on the roads and unlikely to see EV charging as a reliable means to power for those vehicles.
To spur growth in EV ownership, Smart Columbus developed a series of programs aimed at boosting awareness and education among residents who were most likely to buy EVs within the grant period. This included a benchmarking survey to understand behaviors of early adopters. We also created programs to offer test drive experiences through the Ride & Drive Roadshow and at the Smart Columbus Experience Center.
“We knew we had to create a market that did not exist, and we knew we had to create that market targeting early adopters,” McGuire says. Doing outreach to Columbus Partnership membership companies and other large organizations in the region, the Acceleration Partner program targeted local businesses with large numbers of possible early adopters.
“We had to get butts in seats and have people actually experience the technology to not only be educated and understand its benefits but also to be aware and create buzz around the vehicles,” McGuire says.
Working directly with OEMs
EVs are not yet produced in mass quantities by every manufacturing brand in the U.S., and a lack of state mandates do not incentivize automotive companies to allocate EV inventory to Columbus. As a result, dealerships in Columbus have historically lacked a business case to sell EVs. Some dealers never stocked EVs, and others had a small number of vehicles in inventory, with few sales associates well-versed in the benefits of EVs.
Smart Columbus was able to shift some OEMs perception of the state of Ohio by investing in the wraparound education and awareness activities with potential consumers and working directly with local dealers to educate them on the benefits of selling EVs.
Each OEM has their own EV goals, and Smart Columbus created unique approaches to developing an impactful relationship with many of them:
Honda, with its American manufacturing and research & development operations headquartered in the Columbus region, is a Smart Columbus partner. An estimated 40 percent of vehicles sold in central Ohio are Hondas. When the Smart Columbus Electrification Program began, there were no Honda plug-in hybrid electric vehicles (PHEVs) available from local dealers. We were able to work with Honda to prioritize distribution of the Honda Clarity to Columbus. Because of this intervention, Honda dealers in our market sold out of the Clarity, and the car became the fastest-selling PHEV in the market.
EVs are 100 percent of Tesla’s business, and the unique company was proactive in working with Smart Columbus starting in early 2018. The Smart Columbus team has been able to work directly with the regional manager, the local store manager, delivery manager and the staff to create several engagements, including having Teslas available to test drive at Ride & Drives and on display at the Smart Columbus Experience Center. We’ve been able to connect to the company at each level, allowing us the opportunity to deliver EV gift bags directly to Tesla buyers. Tesla has also worked directly with Columbus Yellow Cab when the company ordered 10 Tesla Model 3s for its taxi fleet.
Local Nissan dealers have had the LEAF on car lots longer than many other local dealers have sold EVs, so Nissan has also been more proactive working with Smart Columbus.
Nissan has a dedicated EV staff member based in Columbus who covers the Midwest region, that includes Ohio, Pennsylvania, Virginia, West Virginia, Maryland, Washington D.C., Delaware and New Jersey. The regional manager has been able to make connections between Nissan’s corporate office and regional dealerships, resulting in more EV inventory to local dealers. Those local dealers were able to make cars available for the Ride & Drive Roadshow and are part of Electrified Dealer program. The Nissan team also worked closely with Smart Columbus to make the LEAF more than half of the 200 EVs purchased by the City of Columbus.
Through relationships with the corporate office, Smart Columbus was able to offer EV incentives--$4,000 to AEP employees and customers and $3,500 for public fleets and all residents within the seven-county Smart Columbus footprint.
The Smart Columbus team proactively build a relationship with Toyota by connecting with the regional manager and share how Smart Columbus could help the OEM’s business. Tansky Toyota is located in Columbus and is one of the top Prius Prime dealers in the region and was able to connect the Smart Columbus team to one of Toyota’s regional managers.
That connection led to more Toyota EVs being allocated to local dealers, along with EVs being available for the Ride & Drive Roadshow and the Smart Columbus Experience Center showroom. After offering EV test drives through Smart Columbus, Toyota was able to provide 24 Prius Prime for the City of Columbus’ EV fleet purchase and offer incentives to the employees of local businesses through the Ignite Action Fund.
Moving forward, Toyota plans to launch the RAV-4 PHEV in the Columbus region in late 2020.
At the inception of Smart Columbus, Kia had no EV inventory in the Columbus region, so the team was proactive in establishing a relationship. The region also lacked a strong EV dealer to make a connection with the regional or national corporate Kia office.
“We didn’t have a champion dealer to make the connection for us,” McGuire says. “I made a connection via LinkedIn and was able to meet the corporate product planning director at the LA Auto Show. After telling him about Smart Columbus, I got connected with the regional manager.”
After cultivating the relationship with Kia’s central Ohio dealer manager, the Smart Columbus team worked to get the Kia Niro PHEV to regional dealers. Kia previously would only send them if dealers asked for them, so McGuire worked quickly to certify local dealers for the Electrified Dealer program and coordinate with dealers to put in requests.
Thirty-two cars were allocated for local dealers and Ricart sold all 10 allocated to their dealership fairly quickly. With the help of Smart Columbus providing EVs for test drives, the City of Columbus also purchased 24 Kia Niro PHEVs. The Smart Columbus team is hoping to get a full EV in the Columbus region before the end of 2020.
Results & Future Market Penetration
The Columbus region has been able to outpace the Midwest in EV adoption through these its work to attract more vehicle options to the region and to educate consumers on the benefits of EVs. According to the Electrification Coalition, without Smart Columbus’ programs, the EV market in the region would’ve been around 0.8 percent by Q1 2020. But thanks to the work of the Electrification Program:
- More than 3,200 EVs were sold in the Columbus region through the Smart Columbus grant period, exceeding our vehicle sales goal
- 23 different models are currently on dealer lots in the region representing 61 percent of EV models available nationwide
Overall, these engagement activities have created a wealth of data that we’ve been able to supply to OEMs. After each year of the Ride & Drive Roadshow program, OEMs received data on how many events each car attended, the number of test drives and contact information for test drivers who wished to be contacted by a dealer following their test drive experience. Pre- and post-test drive surveys were able to capture drivers’ experiences and measure how likely they are to buy the car they test drove. We also provide OEMs with demographic information including age, gender, salary and commute times of drivers.
“Working directly with OEMs and local dealerships has proven to be very successful,” McGuire says. “We’ve brought them into the conversation which has been helpful to the market because it has vastly increased EV visibility.”
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