Group Purchase Programs Can Dramatically Boost EV Adoption

By · March 18, 2016

Last year, the Colorado counties of Boulder, Adams and Denver banded together to offer discounted group purchase rates on solar panels and electric vehicles. The group purchase program was the first of its kind for EVs in the United States. Its promising results indicate that it shouldn’t be the last.

Over the course of four months, a partnership between the counties and one local Nissan dealership resulted in 248 Nissan LEAF sales—up from an average of 52 for that period before the program. A similar program in Larimer County netted 26 purchases per month, up from an average of just four. Even more impressive is the fact that according to a survey of participants, just 28 percent said they had planned to buy an EV before hearing about the program.

How it Works

When a large fleet purchases 200 vehicles, you can bet they’re paying a lot less per car than an individual consumer. In some cases, a dealership might be willing to sell vehicles at cost just to benefit from manufacturer volume bonuses.

The Colorado program started with administrators putting out a call for proposals from dealerships in the area. The winning proposal from Boulder Nissan allowed area residents to purchase a LEAF at a $8,349 discount between manufacturer and dealer volume incentives, bringing the purchase price of a LEAF S to just $12,130 after state and federal tax credits. (The SL dropped to just $14,780 and the SV to just $16,685.) The dealership also threw in zero-percent financing for six years for customers with qualifying credit, as well as two years of free access to DC fast-charging.

The deal brought the cost of a 2015 LEAF within range of the cheapest new cars on the U.S. market, dramatically altering a cost-of-ownership equation that has becomes less appealing with lower gas prices. By offering EVs with such discounts, buyers were able to see immediate savings. The economics become even more powerful when paired with discounted solar systems capable of providing low-cost electricity for EVs.

Why Isn’t My County Doing This?

At a time when political pressure is being put on localities to cut emissions, it’s a wonder that programs like the one in Colorado aren’t in place elsewhere. Successful group purchase programs for solar energy have been popping up nationwide since 2010, and unlike tax credits or purchase rebates, these programs come at little cost to local governments. In fact, by stimulating vehicle purchases and directing state and federal purchase incentives to the area, the Colorado program brought home millions of dollars in economic activity.

Could group purchase programs be a ray of light for the EV market at a time when low gas sales are throttling down growth? We’ll get our next chance to find out this spring, when Boulder County embarks on its next round of group purchases. For more information about the program and a handbook written to help others start their own group purchase programs, visit the Southwest Energy Efficiency Project’s website.

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