Why the Electric Vehicle Slowdown May Not Last
By Bo Beard | May 30, 2024
Potential slowdown
US electric vehicle sales had a slow start in the beginning of the year, with stagnant sales and setbacks for companies like Ford and Tesla.
However, despite signs of a potential slowdown in the EV sector, there are strong indicators pointing to significant growth ahead.
Tesla and Ford
Currently, brands like Tesla and Ford are facing challenges due to the absence of new models and a limited pipeline, whereas companies like Hyundai, BMW, Kia, and Cadillac are making significant strides in advancing the EV market.
A sluggish start
General Motors and Tesla experienced a sluggish start to the year, attributed partially to their product cycles.
Tesla's Model 3
GM ceased production of the popular Chevy Bolt without an immediate replacement available, while Tesla's Model 3 production was briefly paused for a planned redesign.
US EV manufacturers
In the first quarter, top US EV manufacturers, including Hyundai-Kia and Ford, saw substantial sales increases, with strong consumer interest continuing into April.
Limited range
The EV market shows a contrast, with some brands thriving while others face challenges like limited range and high prices.
New releases
Stephanie Valdez-Streaty from Cox Automotive highlighted delays in new releases impacting market momentum, emphasizing varying demand growth rates across brands.
EV growth
GM is set to drive significant EV growth in the US in 2024 by electrifying key brands like Equinox SUV, Blazer, Silverado, and GMC Sierra pickups with up to 450 miles of range using the Ultium battery line.
LG Chem
GM's partnership with LG Chem addresses past battery and software issues, with CEO Mary Barra indicating resolution and anticipates a production increase of 200,000 to 300,000 Ultium-based EVs.
Growth projection
The shift from 5,800 to potentially 300,000 units sold reflects a substantial growth projection, amidst varying perceptions of the US EV market, as described by Barra.
Unmatched
Tesla remains unmatched in achieving significant EV success in the US, with no other car company selling over 100,000 EVs annually across their lineup. Hyundai, GM, and Ford are all set to hit this milestone of mass production this year, signaling a pivotal moment in US EV competition.
Previously lagging
Even automakers previously lagging in the EV space are entering the US market in 2024. Stellantis is preparing to launch electric Jeeps and Ram pickups, while Hyundai is introducing a range of EVs from its new Georgia factory opening in October. Honda has commenced deliveries of the Acura ZDX and is establishing a production center in Ohio for upcoming EVs in 2025.
A significant rise
The International Energy Agency forecasts a significant rise in US fully electric vehicle sales to 2.5 million by 2025, up from 1.1 million in the previous year.
Tesla
Tesla, a prominent player in the US EV market, relies heavily on the Model 3 and Model Y, facing uncertainties with limited upcoming releases.
Planned models
Planned models include a Roadster supercar and more affordable options hinted by Elon Musk. Tesla's introduction of a self-driving "Cybercab" without a steering wheel raises technological readiness and sales growth questions.
Supercharger network
The company's Supercharger network transition to non-Tesla owners and rehiring of laid-off employees signal ongoing developments.
