Fuel Price Surge Drives Interest in Electric Cars Despite Government Subsidies
Translated & summarized from N12 by baba
The story in 5 lines · by baba
- Fuel price hikes have caused a fivefold increase in interest in electric cars.
- Electric vehicle inquiries reached 23.5% of used car searches in September.
- Consumer interest in electric cars continues despite fuel price stabilization and subsidies.
- A government intervention cost over 450 million shekels to reduce fuel prices.
- A Yad2 executive stated consumer preference shifts are difficult to reverse.
Interest in electric and hybrid vehicles in Israel has significantly increased, driven by sharp rises in fuel prices, according to data from the classifieds website Yad2. Following a substantial fuel price hike in April, coinciding with the "war against Iran," the proportion of inquiries for electrified cars on Yad2 jumped. This trend continued even as fuel price increases moderated later in the year and the government intervened with subsidies.
Data collected for N12 shows that the growth rate in interest for electrified vehicles has quintupled. In September, inquiries for electric, hybrid, and plug-in hybrid cars constituted 23.5% of all used car inquiries on the platform. This represents a rapid shift compared to a similar increase that took approximately a year and a half previously.
Despite a recent government intervention costing over 450 million shekels to mitigate fuel price hikes, including a reduction in the price of gasoline to 7.77 shekels per liter in early October, the shift in consumer preference towards electric vehicles appears irreversible. Yad2 data indicates that even after fuel prices stabilized and decreased in June-July, interest in electric cars did not wane.
Shani Raabed, CEO of the Vehicle Vertical at Yad2, stated that consumers are behaving like they are on a one-way street regarding fuel prices, with movement only in one direction. She explained that a change in fuel prices can accelerate a decision already being considered by consumers, and a subsequent drop in gasoline prices is not necessarily enough to reverse these changed preferences.
While interest in electric vehicles at 23.5% is still lower than for gasoline cars, Yad2 notes that fuel price is just one factor among many influencing the car market, alongside model availability, car prices, tax rates, and the entry of new brands. The future trend will depend on post-election fuel prices and a potential reassessment of subsidies by the Minister of Finance.
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