An upstart Canadian auto seller is aiming to drive the worldwide market for electric vehicle sales by launching an innovative web-based sales platform and showroom that will move transactions online and away from the traditional car lot.
Dedicated solely to electric and hybrid-electric vehicles, the GTA-based company, called EVEN Electric, will not be exclusively aligned with one particular auto maker. Instead, the retailer will sell multiple, competing brands of both used and new green vehicles, delivering them right to the driveways of consumers around the world and often to places where electric cars are not yet sold.
The model, which departs drastically from traditional auto sales conventions, is designed to address several issues hampering the proliferation of electric vehicles (EVs) on the road. EVEN's founders say many of those issues can be traced to problems at the point-of-sale.
"The traditional dealership model has proven unable to deliver the sales and service experience that EV owners want and need," said Mike Elwood, EVEN's chief executive officer and a co-founder of Electric Mobility Canada, a national advocacy organization. "The old model is antiquated in the way they make their money.
"We're not trying to sell you a specific brand. We're trying to sell you the right EV for your lifestyle."
Traditional bricks-and-mortar car dealerships rely heavily on high-volume sales that translate into a steady stream of service dollars – some dealers make up to 50 per cent of their revenue from oil changes, tune-ups and other gas engine-related maintenance. Electric vehicles require less upkeep and most owners visit service centres once per year or less.
"We have some clients who drive 50,000 kilometres and bring their car in for service and find it needs very little," said John Gordon, a co-founder of EVEN who has been operating an all-electric used car dealership outside St. John's, Nfld., since 2013. On many days, he said, his service centre has no bookings; his mechanic works between three and six hours per week.
The lack of prospective service revenue is just one of the cascading factors that has made conventional car dealers slow to embrace EVs; for years, auto industry observers in both Canada and the United States have been documenting the friction and highlighting it as one of the reasons there aren't more EVs on the road.
For dealers, many of whom are franchisees, investing in a slew of EV inventory is an expensive gamble that must be shored up with new (expensive) technology in their service centres (for the rare occasions the EVs they sell that do need fixing), new training for mechanics on electric technology and new training for sales staff. Add to that the fact that making an electric sale takes two and sometimes three times the amount of time compared with a similarly priced gas-powered car (new EV drivers come with a lot of questions). For sales staff working on commission, the choice not to push EVs is a no-brainer.
There are problems even when consumers arrive at dealerships informed and ready to buy electric. Not all dealerships are certified to sell EVs; those that are aren't guaranteed to be prepared to do a deal. A secret shopper survey conducted in 2014 by the Ontario-based EV advocacy organization Plug'n Drive found 38 per cent of certified dealers had a floor model, many of which were not available for test drives. Nearly half the certified dealers surveyed did not even have an EV on their lot.
"The industry has evolved to sell a certain kind of gas-powered product very well. They don't have the skill set to sell innovative, new products in the way that Silicon Valley does," said Eric Cahill, a California-based vehicle technology consultant who published a dissertation on electric car sales. "We shouldn't be too surprised that they're stumbling here," he said. His firm, Adaptiv Consulting, trains auto sellers to think about how to "borrow from the Apple playbook" when it comes to new technology.
This is where EVEN sees itself ahead of the game. Backed by Microsoft, which has pledged to design the company's cloud-based EV showroom and sales platform, the company plans to register in Ontario but will set up licensed, bricks-and-mortar "education centres" around the world where customers could visit to learn about EVs from staff experts trained to help fit them with the ideal model for their lifestyle. The sleek design of the locations is inspired by Apple and upstart EV auto maker Tesla, which has showrooms but sells most of its cars online.
After test-driving a range of models across several brands, a customer would then purchase their chosen vehicle from EVEN's online inventory. Once adapted according to the safety regulations of the buyer's home country, the vehicle will be shipped from an EVEN warehouse to the customer or the closest EVEN education centre. Mobile service centres in areas of operation will visit customers to maintain vehicles when needed and to drive awareness of EVs one neighbourhood at a time, said Elwood.
A one-year pilot run in Iceland by the company's third co-founder, Gisli Gislason, has given EVEN data points to build from, Elwood said. Already the company has signed licenses with an operator in Panama. Iceland continues to operate and EVEN has its sights set on breaking ground in the United States, Malta, the Caribbean, Cuba, Belgium, Sweden and several parts of Canada.
There will be hurdles: Elwood said the company envisions itself not as an auto dealer, but as an online retailer. But Ontario's Motor Vehicles Act stipulates that all auto retailers and sales people register with the province, said Terry O'Keefe, director of communications for the Ontario Motor Vehicles Industry Council.
"We don't want to stand in the way of new business models. But we have to ensure we're fulfilling our mandate and that is consumer protection," O'Keefe said.
Elwood said EVEN is poised to adapt to the necessary conventions, but also to push beyond them to find consumers and new auto makers ready to innovate.
"There's a world out there looking for change. Electric vehicles mean change," he said. "We're going to areas that want it. And lots want it."
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