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Electric vehicle sales in the United States set a record this past quarter and are on track to break the 1 million mark in 2023, which will be a major milestone for the industry. This increase occurred even as many models were no longer eligible for federal and some state incentives.
Analysts at Wards Intelligence and Car Cox reported that consumers purchased nearly 300,000 electric vehicles from the beginning of April to the end of June. This represents an increase of nearly 50% year-on-year and includes growth in May and June. , the first two months after the federal tax credit rules became stricter. Plug-in hybrid sales also increased.
“There are some vehicles that are attractive enough to buyers that you don’t need to discount,” said Christie Schweinsberg, sustainability analyst at Wards, noting that an increasing number of electric vehicles and options are available. for consumers to choose from. “People will still want to buy.”
But there are signs that the dizzying rate of revenue growth may not be sustainable. According to Cox, at the end of June, dealers have an average of 53 days of internal combustion vehicle deliveries in stock. On the other hand, inventories for electric vehicles are more than double that number. Overall, there were more than 92,000 electric vehicles available in the second quarter, compared with about 20,000 a year earlier.
“Demand hasn’t kept pace with production, which is the opposite story from a year ago,” said Michelle Krebs, executive analyst at Cox Automotive. “We call it the ‘Field of Dreams’ moment. Automakers are building more, but not enough consumers are coming into the field.”
Krebs attributes the glut to both a post-pandemic production boost and traditional consumers’ reluctance to buy electric vehicles. Price is the main barrier between buyers, she said Cox survey, because electric vehicles are generally still more expensive than a similar gasoline-powered model. Concerns about the charging infrastructure are another reason potential holders stay out.
Krebs said the context of incentives for electric vehicles has also become more confusing. At this time last year, dozens of vehicle models were eligible for federal tax credits of up to $7,500, with many cities and states offering additional incentives. Since then, some places, such as Oregon And New shirt, ran out of money for their discounts. The Inflation Reduction Act which Congress passed last year that established manufacturing standards to encourage automakers to invest in U.S. battery manufacturing facilities and supply chains. That law, at least in the short term, cut it significantly list of models eligible for a tax credit.
“We certainly see the impact of it,” said Michael Stewart, a spokesman for Hyundai, whose company is not currently responding to the new requirements, which removed the federal listing. While sales of all Hyundai electric vehicle models grew despite the credit loss, he believes progress toward the company’s ambitious electric vehicle sales goals—and the country —probably even bigger with them.
