The work-from-anywhere culture, inventory shortages and the expansion of technology in both the car buying process and the cars themselves – these are the forces defining the automotive landscape for 2022 according to Cars.com, one of the main markets for buying cars. Despite a double-digit increase1 global prices and a narrowing market value gap between new and used cars, consumers are using the leverage they have to get the car they want, the way they want it.
“Our relationship with our environments – work, home, commerce, vacation – they all evolve, and personal vehicles are, quite literally, how many of us navigate these environments. So naturally, the way car buyers buy – and what they buy – has changed over time,” said Aaron Brangmanfrom Cars.com Detroit Office manager. “More vehicles are being pre-ordered through dealers as dealers continue to manage inventory shortages; more consumers are considering electric vehicles now that local personal use has become more of a factor than longer daily commutes, making them more attractive; and perhaps most importantly, consumer desire for personal transportation remains strong, as health and safety are always at the forefront.
- Pre-orders are becoming widespread: Some 41% of recent buyers plan to pre-order their next vehicle from a local dealership,2 and of the 16% who recently pre-ordered their car, 98% had a good experience and would do it again.3 After spending an average of 19 hours4 By researching Cars.com for the exact specs, color and trim level they want on their new car and selecting the best dealership to work with, pre-ordering allows buyers to get what they want without being limited by current availability, which has been limited by chip shortages and other inventory challenges.
- Unprecedented enthusiasm for electric vehicles: About two-thirds (66%) of Americans surveyed said they were more likely to buy an EV after the Biden administration last year announced plans to support EV infrastructure nationwide and offered financial incentives to accelerate the country’s transition to EVs.5 While electric vehicle sales are growing at a slower pace, interest continues to grow. Searches for electric vehicles on Cars.com have almost doubled since 2020 with markets such as San Francisco; Los Angeles; Sacramento, California.; Seattle and denver lead the charge.1
- Double-digit price increases not stopping demand: Consumers did not hesitate to purchase vehicles even though prices rose and availability fell last year. In fact, more than 60% of consumers said that the shortage of inventory and price increases had not changed their time to purchase.6 In 2021, total auto sales were 14.9 million vehicles, according to the US Bureau of Economic Analysis. Still, some consumers concerned about the pandemic and vehicle shortages have decided to delay their purchase over the past two years, creating strong pent-up demand for vehicles this year — a good thing for the auto market.
- Digital car buying is accelerating: 38% of current car buyers expect to complete the entire buying process online, while 38% intend to purchase a vehicle in person but complete all paperwork online, which means saves them hours at the dealership.² With platforms like Cars.com adding new features for shoppers to do more of the online car buying from dealerships – including loan approvals instant payments and online financing – the car buying experience is changing for the better. Fortunately for consumers and dealers, digital facilitation works both ways; 41% of Cars.com’s market audience is also looking to sell their current vehicle before buying a new one, presenting new opportunities for dealers to acquire cars directly from consumers.1
- Automotive culture is changing in response to the changing workforce: With the remote workforce taking control of how their time is spent throughout the day, we could see traffic patterns changing, peak retail hours changing, and a continued evolution of consumers’ relationship with their cars. Workers are already using their newfound flexibility to cross things off the to-do list, with 67% of remote workers saying they run errands throughout the day2increasing Americans’ car use during hours previously spent in the office.
1 Cars.com internal data, 2021
2 Cars.com Consumer Survey Results December 10, 2021; 1,002 responses
3 Cars.com’s DealerRater survey, December 8-13, 2021; 11,080 responses
4 JD Power, 2021 US New Autoshopper Study
5 The results of the Cars.com survey April 2021; 1,056 responses
6 Cars.com consumer data, Q4 2021