The importance of the brand when buying traditional or electric cars

Automakers are putting in tremendous effort to foster brand loyalty, but it appears that electric vehicles (EVs) have a unique advantage—they naturally attract new buyers. A recent study has revealed that there are distinct variables that set apart the purchasing decisions for traditional vehicles from those for electric ones.

Unlike the usual scenario with combustion vehicles, where factors like brand tradition and established trust play a significant role in decision-making, the same cannot be said for electric cars.


The importance of the brand

According to a recent market study conducted by the firm Edmunds, a staggering 85% of people are open to purchasing an electric vehicle from a brand they have not previously owned. This trend is proving beneficial for car manufacturers like Kia and Hyundai, as electric vehicles are enabling them to attract new customers. The rise of electric vehicles is poised to disrupt the traditional customer loyalty dynamics that have long been a cornerstone of the automotive industry and vehicle brand identity.

For decades, automakers have invested substantial resources in marketing efforts and incorporating customer feedback to cultivate brand loyalty among their customer base. Many individuals develop a strong affinity for a particular brand, often driven by factors such as confidence, family tradition, or personal preference.

Maintaining customer loyalty has always been a crucial objective for car companies and dealerships. This is not only because brands aim to prevent customers from switching to competitors but also because retaining existing customers is more cost-effective than acquiring new ones.

Different in the electric car

When it comes to electric cars, traditional brand loyalty takes a back seat. According to market research conducted by Edmunds, a staggering 63% of EV buyers switched brands when purchasing their new electric vehicle during the first quarter of 2023.

“Traditionally, automakers rely on consumer loyalty to maintain their sales rates, but the rise in consumer interest in electric vehicles, coupled with the limited options available in the market, is prompting buyers to consider taking the wheel of brands they have never experienced before,” said Jessica Caldwell, the executive director of insights at Edmunds.

EVs are disrupting the established patterns of brand loyalty that automakers have grown accustomed to. It will be fascinating to observe whether the increasing number of EV models from major brands will ultimately drive consumers back to their traditional loyalty trends or if brand loyalties will become a thing of the past entirely.

Furthermore, it has been observed that certain brands are failing to seize the opportunities presented to them. For instance, some automakers are not leveraging the high consumer confidence in their brands to gain an advantage in the EV race. The top five brands that consumers trust to produce the best EVs are Tesla (18%), BMW (12%), Toyota (8%), Chevrolet (7%), and Audi (7%). Interestingly, only two of these brands (Tesla and Chevrolet) rank among the top five EV sellers by volume as of the first quarter of 2023.