A survey from Cox Automotive estimates that electric vehicle sales in the US auto market could surpass 1 million units for the first time in 2023. Electric cars currently account for about 6.5% of the country’s automotive sector. Cox also found that about 51% of consumers are now considering the purchase of a new or second-hand EV. That’s up from 38% in 2021.
Such a trend, however, seems to be largely pushed by Tesla and the popularity of the Model 3 sedan and Model Y crossover. The Model Y became the world’s best-selling vehicle by volume in the first quarter of the year, and the Model 3 is expected to see a rise in sales following the release of its highly-anticipated Project Highland update.
Beyond Tesla, however, it appears that the picture is much different in the United States. As per inventory data from Cox, the nationwide supply of electric vehicles in stock swelled by almost 350% this year to over 92,000 units. As noted by Axios, such inventory corresponds to a 92-day supply, which is almost twice the industry average. For context, dealers have about 54 days’ worth of inventory for gasoline-powered cars.
A look at Cox’s data showed that some EV brands are seemingly seeing a lack of buyers. Genesis, for example, sold only 18 units of its $82,000 electrified G80 sedans in the 30 days leading up to June 29. Audi’s Q4 e-tron and Q8 e-tron, as well as the GMC Hummer EV SUV, have inventories that are well above 100 days. The Kia EV6, Hyundai Ioniq 5, and Nissan Ariya are also seeing their inventories stacking up. Even the Ford Mustang Mach-E, which is popular and well-loved, now has a 117-day supply.
One particular reason behind the lack of sales for vehicles like the GMC Hummer EV SUV and the Hyundai Ioniq 5 may be their ineligibility for the Inflation Reduction Act’s (IRA) federal tax credits. The Hummer EV SUV, for one, is too expensive to qualify for the IRA incentives, and the Hyundai Ioniq 5 is an imported unit. The Ford Mustang Mach-E is a bit of an outlier since it qualifies for the federal tax credit, but it still has a surplus of inventory anyway.
Tesla, for its part, posted record vehicle deliveries in the second quarter. The company has also adopted an increasingly aggressive pricing strategy, especially with its mainstream vehicles, the Model 3 and Model Y. With the highly anticipated Project Highland update coming soon, the demand for Tesla’s most popular cars may very well improve even more.
Yup, even though Tesla service and support is utter garbage, dealing with sleazy dealerships is worse. I am hoping that Tesla will grow to a point where there is better 3rd party service and support options, or Tesla has to improve service to grow market share. The problem that Tesla has always had is that the product is so much better than the competitor that they can keep high margins and the cost of support at a minimum.
I’ve had zero support issues, when my headlight went out they replaced it in my driveway the next day. I generally see service appointments available as early as next day… Other areas may be different but major metros are fine