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Consumers Shifting Towards ICE Vehicles

Recent findings from EY's annual Mobility Consumer Index (MCI) reveal a notable shift in consumer preferences for automobiles, suggesting a turn away from electric vehicles (EVs) and towards internal combustion engine (ICE) vehicles. This trend begs the question: what are the underlying factors driving this change?

Declining Demand for Electric Vehicles

The report indicates that nearly half (50%) of automotive buyers globally plan to purchase an ICE vehicle within the next 24 months, marking a 13-point increase from the previous year. In contrast, preferences for battery electric vehicles (BEVs) have dropped to 14%, a decrease of 10 points, while hybrid vehicle interest stands at 16, down 5 points. Alarmingly, 36% of prospective EV buyers cite geopolitical issues as a key reason for reconsidering or postponing their purchases.

The shift appears to be influenced by several factors, including uncertainty about range, insufficient charging infrastructure, and recent changes in public policy, such as the removal of EV tax credits in the United States. The auto industry is responding by refocusing on ICE and hybrid models, thereby adjusting to changing consumer needs.

The Concerns of Consumers

Among consumers opting for ICE vehicles, concerns about EVs mainly revolve around range anxiety and charging costs. Around 29% of these consumers regard range as their most significant worry, while 28% are anxious about the availability of charging stations and high battery replacement costs. Presently, 32% of BEV owners share similar concerns regarding range. Furthermore, among those considering their first purchase, 37% highlight the fear of expensive battery replacements as their top concern.

Despite these fears, around 33% of potential BEV buyers show openness to participating in vehicle-to-grid (V2G) services, indicating a strong interest in solutions that could enhance the economic feasibility and reliability of EV ownership.

Practical Value Over Novelty

The research also sheds light on consumers’ priorities when it comes to connected features in vehicles. The desire for practicality is evident, with consumers placing more importance on functionality, security, and navigation services over simply new or entertaining features. Close to 39% of respondents point to the high costs of connected services as a primary barrier to adoption, and around 60% feel that lower levels of automation would suffice for personal vehicles.

Conversely, consumers exhibit limited trust in high-level automation (above Level 3). Only 26% feel safe with advanced automated vehicles, with predominant concerns surrounding accident risks, technical malfunctions, and loss of vehicle control.

Constantin M. Gall, EY's leader in Global Aerospace Defense & Mobility Practice, noted that the emergence of software-defined car platforms would increasingly influence consumer purchasing decisions. While trust in advanced automation remains low, technical advancements offer manufacturers a significant opportunity to enhance safety and provide more personalized driving experiences.

Retail Dynamics in Vehicle Purchases

Despite the digitalization of car buying processes, the final steps still largely revolve around in-person interactions with dealers. Approximately 41% of buyers prefer completing their transactions face-to-face. While online purchasing is on the rise, particularly among ICE vehicle buyers (32% vs. 28% for EV purchasers), EV buyers often seek in-person advice on charging and new technologies.

Conclusion

The 2025 EY Mobility Consumer Index data demonstrates a pivotal moment in the automotive market, marked by a retreat from electrification towards more traditional vehicle options. As market dynamics evolve, stakeholders must adapt to consumer demands while addressing the challenges posed by infrastructure and technology.