The EV Sales Seesaw Continues — Tesla Down In California, Volkswagen Up In China
You could get whiplash trying to keep up with all the EV sales data from around the world. Depending on which report you read, EV sales are in the toilet — a flash in the pan destined to become an historical footnote along with the electric fork. Or EV sales are exploding, especially in countries where two- and three-wheeled vehicles are popular. Polestar is down, but Volvo EVs are up. It’s enough to make you think there is no rhyme or reason to EV sales patterns at all.
Are EV Sales Up Or Down?
Want proof? Here are two stories from the news today that clearly demonstrate the differences in various segments of the market. A Reuters report says registrations of Tesla vehicles in California fell about 8% in the first quarter of 2024, and that sales fell for the second consecutive three-month period there. That’s according to data from the California New Car Dealers Association (CNCDA). About 50,000 new Tesla vehicles were registered in the state, one of the most important markets for the company, in the quarter that ended March 31. Globally, Tesla’s quarterly deliveries fell for the first time in nearly four years as price cuts and incentives proved insufficient in drumming up demand.
Nevertheless, the Tesla Model Y was the best selling new vehicle in California, the report said. The Model 3 and Model X premium SUV were among the top three best selling battery electric and plug-in hybrid vehicles. The overall market share for battery EVs in the state fell to 20.9 percent from 21.2 percent. Reuters suggests that minuscule decline is the result of consumers gravitating to less expensive and longer range gasoline-hybrid electric vehicles.
The usual bunch of idiots here at CleanTechnica think that claim is a bunch of Grade A horse puckey. The Tesla Model Y starts at $42,990 today. (Who knows what it will be tomorrow!) The Hyundai Santa Fe plug-in hybrid starts at pretty much the same price. The Tesla is eligible for the $7,500 federal EV rebate, the Hyundai is not (unless you lease it; see dealer for details.)
EV sales in general in California were up 3% in the first quarter, with Mercedes, BMW, Audi, and Rivian recording sharp upticks in EV sales during the period. Tesla’s share of the battery electric market in California fell to 55.4% from 61.8% a year earlier. That is a statistically relevant drop.
Volkswagen Doubles EV Sales In China
Contrast that with a report from CNN that says Volkswagen saw EV sales in China double to just over 41,000 cars in the first quarter of 2024 compared with a year ago, countering suggestions that drivers may be losing interest in EVs. New orders for electric cars more than doubled in China in the first quarter, Volkswagen said in an earnings statement on April 30. The company does not release order numbers for other markets. The jump in EV sales in China comes amid concerns about slowing EV sales in other regions and as Volkswagen grapples with slim profit margins and increasing competition, particularly in China.
“The future will be electric, this is our conviction,” chief financial officer Arno Antlitz told analysts and journalists during an earnings call this week. He did acknowledge that the pace of EV sales growth in Europe and the United States has been slower than anticipated. EV sales “will increase quarter by quarter, year over year, but not as fast as we have expected,” he said. “You see […] a very challenging pricing environment” in China, Antlitz added, and indicated that Volkswagen would make “sound compromises” between “pricing and volume” in that country. The company said it plans to significantly reduce battery and material costs in order to be cost-competitive with Chinese rivals by 2026.
EV sales by Volkswagen declined 16% in Europe in the first quarter compared with the same period in 2023. “All-electric deliveries in Europe were impacted by supply bottlenecks,” a company spokesperson told CNN. “There is a time gap between incoming orders and the delivery to the customer. The supply bottlenecks mentioned impacted the delivery performance in Q1.”
EV Sales Are Where You Find Them
Volvo is especially excited about its EV sales, particularly with the battery electric EX30 compact SUV coming to showrooms soon. “We are making good progress towards our annual sales target of at least 15% growth and in the months ahead we will focus on ramping up sales of our EX30,” Volvo Cars said in a recent statement. The company said in January it remained confident of “tremendous growth” in the electric vehicle market and expects electric cars to account for half of its sales by the middle of the decade. Volvo has said it will sell only EVs by 2030.
Recently, my colleague Maximilian Holland reported that the Volvo EX30 has experienced a meteoric rise in sales in Sweden, which helped boost the percentage of battery electric vehicles in that country to nearly 35% in March. Adding in plug-in hybrids brought sales of electrified cars in Sweden to more than 58% of the new car market.
Also, recently, Zachary Shahan reported that Ford, Cadillac, Hyundai, and Kia are all experiencing strong EV sales growth as more Americans take the plunge into the world of electric cars. A writer I hold in the highest regard summed it up this way: By the end of last year, sales of electric cars reached 5% or more of the new car market in 31 countries. This threshold signals the start of mass adoption, after which technological preferences rapidly flip. When Bloomberg first completed this analysis in 2022, only 19 countries had passed the 5% tipping point. Last year, the number soared as EVs spread across four continents. For the first time, some of the fastest growing markets were found in Eastern Europe and Southeast Asia. The trajectory laid out by countries that came before them shows how EVs can surge from 5% to 25% of new cars in under four years, Bloomberg says.
The question now is not so much whether the revolution in EV sales is happening so much as it is who the winners and losers will be when the dust settles and victory is declared. BYD has turned itself into an EV sales colossus, largely by aggressively pursuing export markets where the chaos of brutal price competition hasn’t happened — yet.
The upshot here is that the EV revolution is moving forward. Although, progress is not uniform around the world. Regulations and incentives differ, prices differ wildly depending on which market you are talking about, and attitudes vary widely from country to country. The result is that it may seem like EV sales are slowing in some markets, but overall progress is being made on a consistent basis. There will be winners and losers, but predicting who will rise and who will fall is fraught with peril at the moment. Even once mighty Elon Musk is showing he may have feet of clay. This is a horse race and the contestants are barely past the first turn. It’s a little to soon to be declaring what the finishing order will be.
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