For those reading about Tesla’s sales issues or reading Ford CEO complain that they EV industry is doomed because Ford hasn’t met its sales goals — FEAR NOT.
Combined sales of hybrid vehicles, plug-in hybrid electric vehicles, and battery electric vehicles (BEV) in the United States rose to 16.3% of total new light-duty vehicle (LDV) sales in 2023, according to data from Wards Intelligence. In 2022, hybrid, plug-in hybrid, and BEV sales were 12.9% of total sales.
The number of hybrid model offerings declined in 2023, but sales increased significantly across existing models. In addition, manufacturers offered more hybrid crossover options and fewer car options, thereby increasing hybrid availability within the most popular vehicle market segment (crossovers) and decreasing it within the least popular vehicle market segment (cars).
One additional market dynamic that likely influenced BEV sales in 2023 was the increase in the luxury vehicle market share after the pandemic. Wards uses criteria based on price, body style, and size to segment nameplates into luxury and non-luxury. Among all LDV sales, luxury vehicle sales surpassed their 2019 level in 2021, but non-luxury sales have remained 13% below their 2019 level. BEV sales continue to be concentrated in this luxury category, growing to 31.3% of the total luxury vehicle market in 2023 and 1.7% of the non-luxury vehicle market. Vehicle sales classified as luxury made up 80.0% of BEV sales and 13.3% of non-hybrid gasoline- or diesel-fueled vehicle sales. This percentage aligns with the current slate of BEV models offered by manufacturers: 61% are classified as luxury vehicles by Wards Intelligence.
Source: US Energy Information Agency
Tesla and Elon Musk have worked hard to equate Tesla with the Electric Vehicle industry in the minds of Americans. And there is a lot of gloating among the anti-EV crowd that a decline at Tesla is a sign of a weak EV market. The data suggests that the opposite is true. Tesla is weak in part because there is so much competition at the high end of the EV market. Tesla, Porsche, Audi, Volvo, Mercedes, BMW and others are all in competition at the high end.
Transitions happen over time. And this transition is happening in its own time. FEAR NOT.