Back to actual Tesla analysis…
Regarding the recent price hikes in the US—to what extent are they because of supply constraints or demand increases?
Google search trends are probably the single best measure of what the populace is actually thinking about. Google is of course the most popular search engine and it lets people ask questions privately without any social consequences. I do not have sociology studies to support this claim though, so there’s a chance this isn’t actually true, but it certainly aligns with my personal habits and what I’ve observed from everyone around me.
The trends show a large spike in American search interest for “electric cars” in June, almost as large as the spike in March on the week of Russo-Ukrainian war beginning.
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I won’t clutter this post with too many charts, but I see almost identical trends for most individual EV models across all brands I checked, including:
- Tesla S3XY models
- Cybertruck
- Kia EV6
- Audi E-Tron
- Hyundai Kona EV
- Hyundai Ioniq
- Nissan Leaf
Notable exceptions: Porsche Taycan, Jaguar I-Pace, and Mercedes EQS interest seems to be unaffected by fuel prices, and the only spike for Volvo Polestar 2 was the week after the Superbowl. These are luxury vehicles selling mainly to customers who don’t care much about value per dollar, so that makes sense.
I left out Mach-E and Bolt because the trend for them is probably mixed up with the major recall news.
Searches for “Tesla” remain elevated compared to February and earlier, but not much of a recent spike. However I think this search is less informative about demand and curiosity because it’s related not only to the cars, but also the stock, Elon Musk, recalls, Nikola Tesla, Tesla coils, Tesla the rock band, and any other Tesla topics. The chart below is zoomed out to the last five years and it shows “Tesla” interest has very high variance, which means short term spikes are likely not statistically significant anyway, but the long-term trend shows general interest is double what it was in 2017.
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The big one is this: Unsurprisingly, we see a strong correlation between searches for “gas prices” and “electric cars”. Although gas prices have roughly 20x more interest in general, both search terms tend to follow each other’s relative movements.
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Relatedly, “how much does it cost to charge an electric car” is at triple the interest in the USA compare to last year’s baseline, and it’s slowly creeping back up after the explosion of interest in March. Interestingly, unlike other EV-related searches, this one is strongest in the middle of the country, with West Virginia, Kentucky, Alabama, Kansas and Arkansas leading the charge. Conveniently, many of these states have high demand for pickup trucks and are pretty nearby to Austin.
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The dominant conclusion remains that a LOT of people became curious about electric cars when Mr. Putin decided to send troops across the border and fuel prices surged.
Remember when Zach Kirkhorn, a man who does not tend to publicly present himself as prone to hyperbole, commented this on an earnings call?
“The great thing that we're seeing in the space right now is there appears to just be quite a profound awakening of the desirability for electric vehicles. And I mean, to be totally frank, it's caught us a little bit off guard... folks want to buy an electric car and folks want to buy a Tesla right now. It's very exciting for us.”
This comment came in October! Interest has more than doubled since then with no sign of abating any time soon.
It’s clear that high gas prices, more than any other factor, are what drives people (or Americans at least) to initiate self-education about EVs, and from there they begin to learn about the other benefits. Twitter, FUD, politics, oil-funded smear campaigns, recession, and a bunch of other things demonstrably do not matter as much as frustration with sending money up in smoke at the pump every week. In a broader context, this also makes sense because American full-size truck and SUV sales have also historically been correlated strongly with current fuel prices since at least as far back as the 1970s Oil Crisis. Every single day that oil stays at $120/barrel is another day more folks are learning and correcting their own misconceptions and lack of awareness about how great EVs actually are. Once they learn, they remember and intent to purchase in the future is implanted in their minds.