Electric vehicle market share decreased in the first quarter due to a lack of affordable models
According to Tuesday’s update from the Department of Energy’s Energy Information Administration (EIA), U.S. sales of electric and hybrid vehicles fell in the first quarter of the year.
Sales of battery electric vehicles (full EVs) decreased to 7.0% of total light vehicle sales in the first quarter of 2024 from 8.1% in the previous quarter. Nationwide, combined hybrid, plug-in hybrid and electric vehicle sales fell to 18.0% of the market, compared with 18.8% the previous quarter.
According to the EIA report—in a parallel trend California electric vehicle trend quarter—Electric vehicle sales by physical volume increased 7% in the first quarter of 2024 compared to the same quarter in 2023. But to add another context, that follows 13 consecutive quarters of rate increases. double-digit percentage.
EIA update on electric and hybrid vehicle sales – May 2024
Many factors may be at play. Mass-market electric vehicle sales are down 17.9%, and that appears to have more to do with what’s available in the market than demand. For example, Chevrolet Bolt EV discontinued in Q1 and disappeared from dealerships, while GM’s next most affordable model Chevy Equinox EV not come yet; and Nissan has reduced it Nissan Leaf The lineup only has two cuts left.
Nissan Leaf 2023
On a transactional basis, EIA points to Cox Automotive data showing that electric vehicle transaction prices are still about $6,900 higher than the average vehicle price across the market. Number of vehicles qualifies for a $7,500 EV tax credit that could offset some or all of that difference being more limited than last year.
Meanwhile, the overall light vehicle market experienced a decline, led by a decline in luxury vehicle sales, at a time when eight out of 10 electric vehicle sales were luxury models. Luxury car sales accounted for 18% of the new car market in 2023, but in Q1 they dropped to 16%. It’s a trend that’s difficult to escape from the storm of high interest rates and sky-high prices after years of price increases almost everywhere. The agency noted that overall mass-market vehicle sales remain about 10% below pre-pandemic levels, while the luxury segment has bounced back two years ago.
2024 Tesla Model Y. – Courtesy of Tesla, Inc.
Modest Tesla sales increase in the United States year-over-year in the first quarter—about 4% according to Automotive News, based on registrations—wasn’t enough to offset either of these factors. It should be noted that EIA bases these data trends on Ward Intelligence data, which is also derived from registration data.
In the US, most electric vehicles have been priced and positioned as high-end products, if not luxury cars. This is not the case in the rest of the world, and if automakers want to get serious about electric vehicle sales in the US—and get electric vehicle sales to increase—low-cost electric vehicles are the way to go. choose accordingly.
