Affordability tempers EV purchase intent

Affordability pressures are reshaping what buyers value, tempering electric vehicle adoption while elevating expectations for software features and service experiences, according to a recent study.

In the United States, Deloitte’s 2026 Global Automotive Consumer Study found that purchase intent for internal combustion models held at 61 per cent and hybrids at 26 per cent year over year, while battery electric intent rose two percentage points to 7 per cent.

Lower fuel costs remain the top reason to consider an EV at 52 per cent. Most EV intenders plan to charge at home at 77 per cent, yet over half, 53 per cent, say they do not have access to a dedicated home charger, which could add installation costs. Range, charging time and overall cost are the chief BEV concerns at 47, 44 and 40 per cent, respectively.

Globally, EV interest differs by market, with BEV intention highest in China at 20 per cent and hybrid consideration highest in Japan at 43 per cent.

“As the global industry advances toward software-defined vehicle platforms, continuous upgradability is becoming a powerful way to extend vehicle life and strengthen consumer loyalty,” said Jody Stidham, managing director of global automotive at Deloitte. “At the same time, it introduces a strategic dilemma: OTA updates enhance safety and performance and reduce warranty costs, yet they can also keep vehicles feeling newer for longer, potentially slowing future replacement cycles.

“In an environment marked by affordability pressures and limited willingness to pay for digital add-ons, automakers should consider how they deliver software-enabled value across the ownership lifecycle to support long-term growth.”

Brand loyalty is shifting as consumers weigh price, performance and quality. A majority of U.S. respondents plan to switch brands for their next vehicle at 53 per cent. Getting a good deal is the most important part of the purchase experience at 62 per cent, followed by transparent pricing at 47 per cent and experiencing the vehicle in person at 40 per cent. Almost half (46 per cent) said brand origin does not matter so long as the vehicle meets their needs. Dealer visits and manufacturer websites remain leading research channels, with social media and influencer reviews most prominent in India and Southeast Asia.

Software-defined vehicles are generating mixed signals. U.S. consumers showed the biggest willingness to pay for safety and security features, including anti-theft tracking at 61 per cent, pedestrian and vehicle detection at 59 per cent and emergency assistance at 58 per cent.

Privacy concerns are rising, with sensitivities around data from synced devices at 62 per cent, in cabin camera data at 58 per cent and vehicle location data at 58 per cent. Willingness to pay for enhanced over-the-air updates is limited, with 38 per cent not willing to pay extra and 28 per cent willing to pay up to five per cent above list price. Even so, 52 per cent say regular OTA updates would encourage them to keep their vehicle longer, with 26 per cent indicating two to three years. Voice command support in local languages is far more important in China and India at 80 per cent, and in Japan at 70 per cent, compared with 43 per cent in the United States.

“The U.S. automotive sector is entering a critical phase defined by tightening affordability, evolving expectations around value, and a growing emphasis on longer-term ownership experiences,” said Lisa Walker, vice chair and U.S. automotive sector leader for Deloitte.

“As new vehicle demand levels off, deeper collaboration between OEMs and dealers, particularly around servicing and the post-purchase journey, will be important to strengthening loyalty and sustaining engagement in a market where traditional growth levers are becoming harder to pull.”

Servicing continues to shape trust. A majority of U.S. consumers received their most recent service at an authorized dealership at 57 per cent, while independent repair facilities accounted for 31 per cent of visits. Quality of work is the top driver of provider choice at 20 per cent.

Transparency on pricing and work performed is the most important aspect of the service experience at 24 per cent. Trust is highest in the dealership where customers regularly service at 25 per cent, followed by where the vehicle was purchased at 21 per cent.

Image credit: Depositphotos.com

The post Affordability tempers EV purchase intent appeared first on Auto Service World.