As U.S. electric vehicle sales continue to grow, albeit at a slower-than-expected pace, Tesla’s market share has fallen below the headline level as improved rival EV offerings hit showrooms.
Cox Automotive Latest Electric Vehicle Sales Report Tesla’s share of U.S. electric vehicle sales fell below 50% for the first time, to 49.7%, Cox said, as total electric vehicle sales rose to nearly 8% of the market, up from the 7.2% seen in the second quarter of last year, in what it called a “record-breaking” quarter.
“Despite Tesla’s declining sales, with its share of EV sales now below 50% for the first time, the overall competitive landscape for EVs is growing,” Stephanie Valdez Streeti, director of industry insights at Cox Automotive, said in the report.
Looking at the Cox dataset starting in 2019, Tesla’s market share hit a high of 82.5% in Q3 2019 and has been steadily declining ever since. The biggest declines have come in recent quarters, starting in Q4 2021, when Tesla’s market share hit 77.5%. It dropped to 50.2% in less than two years (Q2 2023) as new brands and EVs from legacy automakers enter the market.
Tesla’s stock drop coincides with a drop in second-quarter deliveries. Tesla said it delivered 443,956 vehicles in the second quarter, up from 386,810 vehicles delivered globally in the first quarter but down from 466,140 vehicles delivered nearly a year ago.
With Tesla now at 49.7% of the market, Cox found that the Ford Mustang Mach-E, Ford Lightning EV pickup truck and E-Transit van put it in second place with 7.2% share. Kia, its sister brand Hyundai and BMW rounded out the top five.
Digging deeper into the fastest-growing brands in the second quarter, GM’s Cadillac took top honors with more than 440% growth in EV sales, boosted by its LYRIQ midsize EV. Although Cadillac’s LYRIQ was delayed in its initial rollout as GM worked out some kinks with its Ultium EV platform, sales momentum has been building since the start of the year. Toyota saw sales of its only EV — the bZ4X — grow to more than 7,000 units in the second quarter (up from 2,000 units last year), despite reports of significant price cuts.
“This increased competition is continuing to put pressure on prices, which is gradually driving the adoption of electric vehicles,” said Valdez Streeti of Cox. “Automakers that offer the right product at the right price and provide an excellent consumer experience will lead the way in electric vehicle adoption.”
Increased affordability could boost sales at Ford, Kia and Hyundai. Kia’s moderately priced EV6 crossover, EV9 large SUV and Niro subcompact are reaching larger segments of the market, along with Hyundai’s similarly priced Ioniq 5 crossover or Ioniq 6 sedan.
Luxury brands like BMW and Cadillac are likely to excel in customer service, Valdez-Streetti noted, as higher-income buyers value the dealer experience along with product mix in their purchasing decisions. BMW’s EVs like the BMW iX SUV, i4 coupe and i7 full-size luxury sedan have boosted sales.
Conversely, BMW’s rival Mercedes, which leans heavily toward expensive luxury electric vehicles, saw its EV sales decline in the second quarter (down 22.3%) as its high-priced offerings failed to reach consumers. Mercedes has now reverted to gas-powered vehicles and no longer sees itself going fully electric by 2030.
Pras Subramanian is a Yahoo Finance reporter covering the auto industry. You can follow him Twitter and on Instagram.
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