U. S. battery electric vehicle sales would have arguably surpassed the 1 million unit mark this year, but it looks like they’re stuck at base camp rather than rushing to reach new sales highs.
The evidence is in a mix of hard numbers and more difficult decisions made across some of the major automakers. Those moves come from General Motors Co. , which is slowing its plans to introduce new electric cars and delaying the launch of a new generation of Chevrolet. Bolt EV and EUV through 2025, and Ford Motor Co. reduces production of its F-150 Lightning electric pickup truck by 50% in early 2024.
“If you can bring the price down until the value between an electric vehicle and a hybrid or internal combustion engine is near parity, or parity, then there are a lot of benefits of EVs that can help offset,” Roberts said. Director of Industry Information and Analysis at vehicle sales and research site CarGurus. com in an interview. “But given the value out there, I think it’s pretty complicated for consumers to make that decision. That’s why I think you’re seeing this little kind of reevaluation. EV sales are expanding year-over-year and will surpass one million units of new EV sales in 2023, representing record volume. The expansion just isn’t as fast as they had originally anticipated.
This sentiment was echoed by Pat Ryan, CEO of AI-powered car-buying app CoPilot, who observed in an interview: “We’re seeing record sales, they’re not living up to expectations and that’s simply because Automakers have ignored the typical Generation Adoption cycle and we assumed that EV adoption would be different than how other people generally adopt Generation and of course that is not the case.
A new study published this week via CarGurus illustrates just how complicated the numbers are for electric cars, especially compared to those for new and used internal combustion engine cars.
Like in CarGurus’ “2023 Recap” chart
For used EVs, that extra time in the box translates to lower prices, but Roberts points out that’s not necessarily good news.
“It’s wonderful for consumers who are in the market right now, but if you bought a new or used electric vehicle a year ago and you see a pretty significant price drop, you’re going to be pretty disappointed with this issue,” Roberts said. . ” I think that kind of uncertainty adds a point of potential lag in EV demand. “
But the director of a company that produces sustainable charging infrastructure and batteries for electric vehicles is angered by reports and reports that point to the price difference with ICE vehicles as a barrier to electric vehicle adoption.
Desmond Wheatley, CEO of Beam Global, which produces sustainable EV charging infrastructure and … [+] batteries.
“Comparably equipped electric vehicles are already on par,” said Desmond Wheatley, CEO of San Diego, Calif.-base Beam Global in an interview, and “they’re cheaper by the time you factor in gasoline and maintenance and all the other things that you don’t have to do with an EV.”
In fact, thanks to deep discounts, the costs of electric cars and internal combustion engine cars are converging, according to a Cox Automotive report released Monday.
“Over the past few months, price parity between electric vehicles and combustion engines seemed almost possible,” wrote Stephanie Valdez-Streaty, director of strategic plans at Cox Automotive. “It’s a complex metric with many variables, but newer products and bigger discounts have driven down the average value of EVs, even before any tax incentives. A year ago, the premium for electric vehicles was over 30%. Today, it’s less than 10%.
In fact, to hope to reach an EV deal, patience will pay off, according to CoPilot’s Pat Ryan, who advised, “I think we’re going to see a lot of incentives for new EVs in the coming months, so it’s not a smart time to buy a new EV. If you are patient, you will receive incentives.
The increase in the percentage of new and used electric cars in the market is uncertain, with CarGurus predicting diverging trend lines through 2030 based on customer requests and government incentives or requirements, as illustrated in the CarGurus chart below.
Chart from CarGurus. com showing the range of EV sales expansion forecasts through 2030.
In the best-case scenario, new electric vehicles could account for only 50% of the market until 2030 or could reach only 23% of the existing 8% until that year. CarGurus forecasts expect that the percentage of used electric cars could increase from 0. 4% of the market to 4% or 8% by 2030, depending on conditions.
Beam Global’s Wheatley expressed concern about such forecasts and said fluctuations are to be expected.
“We’re talking about less of an acceleration in expansion than we’ve seen over the last couple of years, which is very different from a drop in anybody’s books,” Wheatley argued. “I mean, EV sales are still up more than 61% this year. Globally, we account for 14% of sales and 8% of sales in the U. S. U. S. At all levels, electric car sales continue to rise. I think we can expect to see repercussions on the speed of adoption.
However, the market is not stagnant and many consumers who still need a greener but more affordable vehicle than an electric vehicle are turning to hybrids.
2023 Honda Accord Hybrid.
“They’ve managed to make charging more manageable in those spaces, so spaces where other people are still comfortable with EVs, charging, range, charging, those are all issues that don’t exist in the same way with hybrids, so the hybrid market is the hot market right now,” Ryan said.
So hot, in fact, that there aren’t many to choose from, Ryan points out, citing as little as a 27-day supply of hybrids on Honda dealer lots compared with an optimal 60-day supply.
Currently, the average value of a new hybrid vehicle represents a 9% premium compared to a vehicle with an internal combustion engine, according to the CarGurus study.
Conversely, the study found that EVs have a 30% premium, while used hybrids have a 16% premium, versus a 43% premium for EVs.
CarGurus’ Kevin Roberts compares hybrids to that “right” selection from the children’s story The Three Bears, which offers consumers a satisfied balance between gasoline cars and zero-emission electric cars, at least in the short term.
Hybrids have a veritable “Goldilocks window, let’s say, until 2030,” Roberts explained. “There’s a genuine opportunity for them to have their moment to shine. “
Far beyond that, he said, automakers will want to rely more on natural electric cars to meet government emissions standards.
So, while the adoption of electric vehicles in the U. S. UU. es slower than automakers had hoped, its eventual dominance remains inevitable, with Beam Global’s Wheatley saying, “I have no doubt that we will see a full electrification of electric vehicles. Transportation. “
It’s just a matter of that mountain at a leisurely pace.