EV and hybrid sales are steadily increasing in the US, reaching an all-time high in Q3 2024, according to the US Energy Information Administration (EIA).
In Q3, the combined sales of hybrid, plug-in hybrid electric vehicles (PHEVs), and battery electric vehicles (BEVs) made up 19.6% of all new light-duty vehicle sales, according to estimates from Wards Intelligence. That’s up from 19.1% in Q2, setting a new benchmark for the growing market share of electrified vehicles.
The growth in Q3 was primarily driven by hybrids. BEV sales slightly dipped, with their share of the light-duty vehicle market going from 7.4% in Q2 to 7.0% in Q3. Meanwhile, hybrids now account for 10.8% of the market – a record high.
BEVs still reign in the luxury segment, making up 35.8% of luxury vehicle sales in Q3 2024. However, the luxury share of BEVs is shrinking as more affordable BEVs make their way onto the market. In Q3, 70.7% of all BEVs sold in the US were luxury models – the lowest luxury share since Q2 2017 – while only 10.3% of hybrid vehicles sold fell into the luxury category. BEVs still come with a hefty price tag: The average transaction price for a new BEV was $56,351 at the end of Q3, about 16% higher than the overall average price for new vehicles, according to Cox Automotive.
Tesla is still the BEV king, but its crown is slipping. For the second consecutive quarter, Tesla’s market share dipped below 50%, coming in at 48.8%. The Model Y and Model 3 continue to be major sales drivers, and Tesla also saw a boost from the Cybertruck, which outsold all of its large electric truck competitors, including the Rivian R1S, Ford F150 Lightning, and Chevy Silverado EV.
Ford still holds onto second place in the BEV market, though its share fell to 6.9% in Q3 from 7.94% in Q2. Chevrolet, powered by the success of the new Equinox and Blazer models, moved into the third spot, replacing Hyundai with a 5.8% market share.
Most of the BEVs sold in the US are now produced close to home. In Q3, 78.9% of BEVs sold in the US were made in North America, with the rest coming from countries like South Korea (7.3%) and Germany (5.3%), based on Wards Intelligence estimates.
The Inflation Reduction Act’s clean vehicle tax credits are also influencing the EV landscape. To qualify, manufacturers need to meet domestic content requirements not just for final assembly, but also for battery components and critical minerals. It’s not as simple as just building a car in North America.
However, the requirements are looser for leased vehicles, which means many EVs that don’t qualify for purchase incentives do qualify for lease incentives under the commercial clean vehicle credit, giving consumers more options to get behind the wheel of an EV.
However, changes to the federal EV tax credit starting January 1, 2025, are anticipated. Joel Levin, executive director of Plug In America, said last month:
We have no way of knowing what will happen under a new administration and new Congress.
So if you’re thinking about getting a new or used EV, now is a great time for both. There are so many models on the market, and consumers can often stack incentives from states, municipalities, and utilities on top of the federal EV tax credit, which provides a great deal for car buyers.
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