Electric Vehicle Companies Could Fill Vacant Flagship Retail Units
The owners of even the best retail units in top-end malls and on high streets are struggling to find tenants at the moment. One new source of demand for space in coming years could be growing electric vehicle manufacturers.
As the electric car market develops in Europe, rather than taking the traditional route of selling vehicles through roadside car dealerships, manufacturers are likely to target flagship retail locations, Savills said in a new report.
Europe is driving the expansion of the EV market, accounting for 43% of global EV sales in 2020, Savills said, adding that demand for showrooms is landing not on traditional motor malls and dealerships but on retail and lifestyle-led locations, from prime shopping centres to popular high streets.
“It’s safe to say that the opportunity in this market is huge, and opening up showrooms in high-profile locations is becoming key,” Savills Head of European Retail Agency Larry Brennan said.
“Stores are forming part of significantly substantial marketing budgets, breathing new life into retail destinations with state-of-the-art fit-outs and providing new and engaging experiences for consumers."
Brennan added that these brands had capital to invest in highly innovative, ultra-modern showrooms that set them apart from traditional car dealerships.
“Standout vehicle and fit-out designs tend to need standout buildings to be best showcased, setting a new benchmark in retail,” he said. “This, tied with the very detailed technical and operational requirements of EV companies, means that sectoral experience is key in delivering the right property solutions.”
In recent months Chinese brand NIO has taken its first step into Europe with a major new 22K SF flagship store on Karl Johans gate, the main retail street in the city of Oslo. This store is scheduled to open at the end of September.
Meanwhile Swedish/Chinese brand Polestar has opted to differentiate itself by choosing unusual or emerging retail locations such as its recently opened store in Berlin’s Hackescher Markt.
Savills said active brands include Vietnam’s Vin-fast, which is seeking opportunities in The Netherlands, France and Germany; Chinese brand Lynk & Co., which is part of the Geely Motor Group; and several U.S.-based manufacturers including Lucid and Rivian.
But over the medium to longer-term, as brands become more established, demand will expand to more conventional locations that can offer larger spaces and test driving capabilities, Savills said.