EV Market Share Slides in Q1 Amid High Prices and Limited Affordable Models, EIA Reports

The proportion of electric vehicles sold in the US dropped in the initial three months, as reported on Tuesday by the Energy Information Administration, a branch of the Department of Energy.

In the initial three months of 2024, the market share of fully electric vehicles (EVs) fell to 7% from the earlier 8.1% of total light vehicle sales. Across the country, the collective sales of hybrids, plug-in hybrids, and EVs saw a decrease to 18% from the former 18.8% market share in the last quarter.

According to the Energy Information Administration, electric vehicle sales saw a 7% increase in the first three months of 2024 when compared to the first quarter of the previous year. This rise mirrors a similar pattern observed in California's EV market for that period. However, it's worth noting that this growth follows a streak of 13 quarters where sales had surged by significant double-figure percentages.

Update on electric and hybrid vehicle sales from the Energy Information Administration – May 202

There could be various elements influencing the situation. Sales of electric vehicles aimed at the broader market significantly decreased by 17.9%, which seems to stem from the range of options currently on the market rather than a lack of consumer interest. For example, production of the Chevrolet Bolt EV was halted in the first quarter, leading to its scarcity at dealerships. Moreover, GM's upcoming, more budget-friendly Chevy Equinox EV is not yet available for purchase; and Nissan has reduced the Nissan Leaf offerings to merely two versions.

The 2023 model of

According to information from Cox Automotive analyzed by the EIA, the cost to purchase an electric vehicle (EV) is still approximately $6,900 more than the market average for all vehicles. Furthermore, the availability of EVs that qualify for the federal government's $7,500 tax credit, which could offset this price discrepancy, has decreased compared to last year.

In recent times, there has been a downturn in the market for light-duty vehicles, primarily due to a decrease in the sales of luxury vehicles. This is notable as luxury vehicles make up 80% of electric vehicle sales. In 2023, luxury vehicles accounted for 18% of the market share for new vehicles, but this figure fell to 16% in the first quarter. This downturn is difficult to separate from the current economic pressures of rising interest rates and increasing vehicle prices, which follows a period of consistent price increases across the board. The agency observed that sales of mainstream vehicles are still roughly 10% lower than they were before the pandemic, whereas the luxury car market had recovered two years earlier.

Upcoming 2024 version of the Tesla Model Y, presented by Tesla, Inc.

Tesla's slight increase in U.S. sales for the first quarter, with a 4% rise as per Automotive News' report on vehicle registrations, did not compensate for the other mentioned elements. It's worth mentioning that these data patterns are grounded on information from Ward’s Intelligence, which similarly relies on vehicle registration figures, as utilized by the EIA.

In the United States, electric vehicles (EVs) are predominantly marketed and sold as high-end or even luxury products. However, this strategy differs from global practices. For car manufacturers to truly increase their electric vehicle market share in the U.S., focusing on more affordable electric vehicles is the key strategy.

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