America's Car Dealers Are Split On EVs

Around half of Ford dealers are sticking to selling gas-powered vehicles for now.

This certainly isn't true of all of them, but broadly speaking, a lot of U.S. car dealers aren’t exactly jumping at the opportunity to sell electric cars. Much like American consumers, it appears a good chunk of them have some hangups in these early days. 

Around half of the country’s Ford dealers have decided to continue selling only combustion-engine models in 2024, the Detroit Free Press reported on Thursday. It’s a similar story at General Motors: Roughly half of Buick dealers in the U.S. have taken buyouts from GM rather than making the investments necessary to sell EVs, multiple outlets reported. 

Both GM and Ford have required their dealerships to invest heavily in EV-related upgrades like charging stations to be able to sell and service EVs. Buick doesn’t sell an electric car in the U.S. yet, but GM plans for it to become an all-electric brand. Its first EV is scheduled to go on sale in 2024. 

According to Ford, the decision for dealers came down to whether or not they operate in an area where people buy EVs. And that makes sense. Although EV sales are growing, demand for them is far stronger in, say, California, than most other states. 

"As Ford dealers have completed their own local market assessments, enrollments for 2024 are just over 50% of the network, placing 86% of the population within 20 miles of a Ford dealership that can sell and service a Ford EV,” a Ford spokesperson told the Detroit Free Press.

Likewise, the Buick cuts aren’t necessarily as major as they sound. The roughly 1,000 stores that took a buyout only represented 20% of sales, according to CNBC. (It's also worth noting the Ford dealers' decision is a vastly more impactful one; Ford builds and sells several EVs, including the Mustang Mach-E and F-150 Lightning. Buick currently sells none.) 

It shouldn’t exactly come as a surprise that some GM and Ford dealers are lukewarm on the idea of selling EVs—and paying a hefty price to do so. Both automakers have said they’re seeing slowing demand for electric cars and have pumped the brakes on EV production and investments as a result. Overall, the U.S. EV market is healthy, and sales are growing. But some models, including Ford’s Mustang Mach-E, have indeed seen bloated inventories this year. 

Dealers have made their distaste for the electrification of the auto industry known before. Thousands of car dealers sent an open letter to President Biden last month imploring his administration to “slow down” the country’s transition to EVs and arguing that “enthusiasm has stalled.” For the record, that’s not exactly true, given that Americans have already bought over 1 million EVs this year. But there’s at least one obvious reason that dealers would rather just keep selling combustion vehicles. 

EVs are far simpler to maintain than gas cars, and don’t need oil changes, timing belts, transmission rebuilds and the like. Owners routinely keep them going for years by just changing out their wiper fluid and tires every now and then. Dealers may be able to sell electric cars if they really tried, but they don’t want to see all that recurring revenue disappear.