Hybrid vehicles in the aftersales future:
What the OEM shift to building more hybrid vehicles can mean for service departments
It’s no secret – hybrid vehicles are gaining traction in markets around the globe. Manufacturers are jumping off the battery-electric vehicle (BEV) bandwagon to give customers the hybrid vehicles that they want while balancing their new-vehicle portfolios with BEVs to meet tighter standards for carbon emissions.
The “all-EV” dominoes began to fall in January of this year, when GM announced it was changing its product lineup to include more plug-in hybrid electric vehicles (PHEVs).1 Shortly after, Ford announced it was significantly increasing its production and sales of hybrid vehicles. Mercedes-Benz, Volkswagen, Jaguar Land Rover and Aston Martin2 followed suit, scaling back or delaying their electric vehicle plans. And in May, Stellantis – citing “uncertain electrification trends,” committed to building a gas-hybrid version of its battery-electric Fiat 500e, while also announcing allocation of a new gas-hybrid version of the Jeep Compass.
Market data has confirmed this shift. According to Urban Science’s industry-leading sales volume data, through June 2024, U.S. sales of hybrid vehicles, inclusive of both plug-in and regular versions, have increased 29.6% YoY vs only 2.5% for BEVs. Overall, hybrids accounted for 12.2% of the market vs. 7.9% for BEVs.3
This shift to hybrids is being driven by continued demand for efficient and practical alternatives to traditional vehicles, combined, however, with consumers’ hesitancy to adopt an all-electric technology without a reliable and prevalent charging infrastructure. In fact, according to a recent study by Urban Science conducted alongside the Harris Poll, 56% of auto buyers believe that the current EV charging infrastructure is unable to meet the anticipated needs of consumers in the next three years.
Pricewise, although BEV prices have steadily declined, ICE and hybrid vehicles are still more affordable, especially for consumers seeking a higher BEV range.