Without Incentives, EVs Would Be In BIG Trouble

Car brands may be backpedaling with their electrification plans due to a slow-down of battery electric vehicle demand, but the latest data from S&P Global Mobility shows that there was an increase in EV users in July 2024. Automotive News reports that Tesla is the biggest winner in this so-called EV race, a comeback after a five-month slump, thanks – in part – to the Cybertruck.

The latest data from July shows a significant surge in BEV registrations in the US – a remarkable 18% increase compared to the same month last year. S&P Global Mobility cited pricing and the strength of new models as the key factors for the sales increase, though it can be seen that the growth was almost uniform across the top 10 brands that sold BEVs.

Tesla Was The Biggest Winner

Tesla may show a mere 1.2% increase in BEV registrations in July 2024 versus the same month last year, but the Texas-based EV maker is still the biggest winner by moving 57,134 units. The Cybertruck – which has faced two delivery holdups (the latest was in June) since its launch in November last year – represents a notable chunk of that volume, with 5,175 units registered. In comparison, electric trucks from other automakers, such as Ford, Chevrolet, and Rivian, only total 5,546 units combined.

Speaking of Ford, the Blue Oval marque was the second-highest EV seller in July with 9,504 EVs registered, representing a 67% improvement over the same month last year. Kia, which sold 4,810 units, also improved significantly by 62%, but neither compares to Nissan, which moved 3,496 units, doubling its July BEV sales compared to last year. The Japanese marque currently sells the LEAF and Ariya BEVs – both among the cheapest EVs on the market for 2024.

Price Is King

The current top 10 BEV volume movers all have entries in the cheapest EVs in the market, showing us that purchase price is a deciding factor for American customers. However, S&P Global Mobility also cited the importance of steep incentives, with some amounting up to $19,703. That price cut was for the Kia EV9, which is expected to receive full federal tax credits later this year. Other attractive incentives cited include $13,015 on Volkswagen’s ID.4 and $7,035 on the Honda Prologue, which can be had for less than a Civic when leased.

“The caveat is that at full MSRP prices, these EV products will not sell,” said S&P Global Mobility analyst Tom Libby. “They are being heavily incentivized to put their price point near internal-combustion vehicles. If the incentives were pulled off, I think sales would drop tremendously.” In other words, automakers have yet to produce electric vehicles at a price that the average person can afford, and until that happens, another major spurt of sales growth is unlikely.

Source:
Automotive News