Summary
- Battery-electric vehicles made up 8% of new vehicle sales in June and July, with estimates showing growth above 8% in September
- Overall new vehicle sales are expected to drop by 12% this month
- General Motors and Ford have shifted resources away from BEVs towards plug-in hybrids
- Tesla’s US market share for BEVs has fallen below 50% for the first time
- Despite some volatility, BEV sales are expected to continue growing throughout 2024 with new models entering the market
Article
Battery-electric vehicles made up 8 percent of new vehicle sales in June and July of this year and are projected to remain above 8 percent for September, according to estimates from S&P Global Mobility. While growth has slowed from the 50 percent year over year increase seen in 2023, the trend is still positive, with market share increasing from 7 percent in the first three months of the year. This growth is occurring within the context of an overall decline in new vehicle sales, which are expected to drop by 12 percent this month. Factors contributing to the stagnant new vehicle sales include high interest rates and slow-to-recede vehicle prices, leading to high monthly payments for consumers.
The rapid growth of battery-electric vehicle sales in the US was largely attributed to Tesla in the past, as the company flourished during the pandemic by offering online ordering and showing flexibility in managing supply chain issues. However, ambitious goals for ending internal combustion engine sales in Europe and the US have faced challenges, causing industry-wide EV pessimism. General Motors and Ford have both faced setbacks in their EV efforts, with technical problems delaying new BEV launches for GM and Ford shifting its focus towards plug-in hybrids despite increased BEV sales. Car dealers have also successfully lobbied the White House to soften fuel efficiency regulations, further hindering the adoption of electric vehicles.
Tesla, once dominating the US BEV market share, has seen a decrease in sales resulting in its market share falling below 50 percent for the first time. Issues such as an aging product lineup and controversial behavior from CEO Elon Musk have contributed to a decline in Tesla’s brand perception, especially in the largest market for electric vehicles in the US. Despite this, new BEVs like the Chevrolet Equinox and the Volkswagen ID Buzz are entering the market, indicating continued growth in BEV sales throughout the rest of 2024. S&P Global Mobility remains optimistic about the future of BEVs in the US market, despite challenges facing the industry.
The overall tenor of the auto demand environment remains one of consistent, but unmotivated volume levels as consumers are dealing with high interest rates and slow-to-recede vehicle prices, resulting in high monthly payments. While the growth of BEV sales has slowed compared to previous years, the trend is still positive with market share increasing steadily. The decline in overall new vehicle sales, combined with challenges faced by legacy automakers in their EV efforts, has created a complex landscape for the adoption of electric vehicles in the US.
Despite facing challenges and setbacks, the electric vehicle market in the US continues to show promise with new BEVs entering the market and sales expected to grow throughout the year. Companies like Tesla, General Motors, and Ford are navigating the changing landscape of the auto industry as consumer preferences shift towards electric vehicles. With advancements in technology, competitive pricing, and increasing availability of charging infrastructure, the future of electric vehicles in the US remains hopeful. S&P Global Mobility’s projections suggest that BEV sales will continue to rise, indicating a positive trajectory for the electric vehicle market in the country.
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