New electric vehicle sales have slow 2024, while used market accelerates
A Mercedes-Benz car is seen charging into the new EV charging station outside the Mercedes-Benz headquarters on Nov. 15, 2023, in Atlanta. (Miguel Martinez/The Atlanta Journal-Constitution/TNS)
No one said electrifying the auto industry was going to be a smooth ride.
Electric vehicle sales got off to a slow start in 2024, with some some automakers — namely EV pioneer Tesla — seeing their sales momentum reverse.
After the country eclipsed 1.2 million EV sales in 2023, new plug-in vehicle sales increased about 3% year-over-year during the first three months this year — a far cry from the 47% growth the sector saw during the same time last year. First quarter EV sales declined 15% compared to last year’s fourth quarter, according to data from Cox Automotive in Atlanta. The end of the year is typically a peak period for auto sales.
The soft first quarter comes amid renewed concern that not enough Americans are ready to switch to EVs despite billions of dollars of private and public investment.
“As we move into this mainstream adoption, it’s going to get hard,” said Stephanie Valdez-Streaty, director of operations management at Cox Automotive.
However, there’s one segment of the EV market that continues to accelerate.
Used EV sales in January increased nearly 70% compared to the same month last year, according to Cox Automotive.
Christina Keiser, Carvana’s executive vice president of strategy, said EVs are poised to make up a significantly larger portion of used car sales in the coming years, even if new sales start to stagnate. She added that many of consumers’ hesitations with EVs, such as a lack of charging infrastructure and range anxiety, will decrease with time as more people get exposed to the technology.
“More EVs on the road begets more EVS on the road as people get comfortable with what ownership looks like,” Keiser said.
‘More sales muscle’
In February, the average new EV sold was about $52,000, roughly a $5,000 premium over gas-powered vehicles, according to Cox Automotive data. That price gap is narrowing, but Keiser said lowering EV prices — both new and used — along with offering a wider variety of vehicle types will help seal the deal for many considering making the switch.
“That accessibility and affordability question is going to be front and center in whether they actually act on that intention,” Keiser said.
Valdez-Streaty said there needs to be “more sales muscle” and education efforts to increase EV adoption. Thousands of car dealerships across the country have signed public letters urging the Biden administration to pump the brakes on increasing EV incentives and implementing new tailpipe emission regulations, citing concerns about sales lots cluttered with unsold EVs.
Cox Automotive still predicts EVs will make up 10% of all new vehicle sales by the end of 2024, up from 7.6% last year.
“We’re going to see more sales,” Valdez-Streaty said, “but not at the growth pace we’ve seen historically the last couple of years.”
