Cars are a major part of American culture. And in recent years, electric vehicles (EVs) have grown more popular among American drivers.
The price tags of EVs have gone down over time thanks to various incentives and the maturation of relevant technologies. At the same time, rising oil prices have made EVs more appealing to consumers who want to save money on fuel.
So how are electric cars changing the rest of the car industry today and in the future? Let’s take a look at the EV market in the United States.
What Percentage of Americans Own EVs?
According to a Reuters report, EVs make up less than 1% of the 250 million vehicles on the road in America. That includes cars, SUVs, and trucks.
Hedges Company, which specializes in automotive marketing case studies, projected that the number of registered vehicles will reach 290.8 million in 2022. However, how many of those will be EVs depends on various factors, such as purchase prices, incentives, and the availability of electric cars.
What Percentage of the US Car Market Is Electric?
Battery-electric vehicles (BEVs) or pure EVs acquired 5.6% of the market share in the second quarter of 2022, which is a new record.
How Big Is the US EV Market?
While the rest of the US car market suffered during the pandemic, the demand for EVs grew steadily. 2021 recorded more than 471,000 new EVs sold in the US. Its first quarter saw sales of 98,000 electric vehicles, while its fourth quarter had the highest sales with 147,799 units.
In the first quarter of 2022, there were 173,561 new EVs sold in the US. The second quarter recorded 196,788 new electric cars sold. Put together, the first half alone of 2022 recorded 370,349 sales of new EVs.
Both Q1 and Q2 of 2022 outstripped the best-performing quarter of 2021, which proves that the demand for EVs has shot up in the past six months.
Below are the top five EV brands that have the most EV market share in 2022 along with their sales for the first and second quarters of the year:
First Quarter
- Tesla: 129,743
- Hyundai-Kia: 15,480
- Volkswagen Group: 7,932
- Ford: 6,734
- Nissan: 4,371
Second Quarter
- Tesla: 130,047
- Hyundai-Kia: 17,979
- Ford: 15,273
- Volkswagen Group: 8,961
- General Motors: 7,217
The Future of EVs in the US
The future looks bright for EVs in the US. The demand for them is going up, and it doesn’t seem to be slowing down any time soon.
Bloomberg noted that when electric vehicles got more than 5% of the total number of new sales in the US, it achieved a critical tipping point. That percentage is the historical threshold for the rapid adoption of new technologies.
Below are some of the ways that the EV market can shift in the coming years:
EV Startups
Since 2020, there has been a worldwide shortage of integrated circuits or “chips” used in various electronics. This “chip crisis” affected almost all automakers, including those that make EVs.
New startups like Lucid are taking advantage of the chip crisis to bridge the gap between them and more established carmakers. The newcomers are offering EVs that can match the performance and quality of established models.
Effective Strategies
Tesla remains king of the US EV market. While its overall share of new EV sales has gone down by 9% between the 1st and 2nd quarters of 2022, Tesla expects to sell more electric cars in the future.
To maintain its supremacy in the EV market, Tesla has leveraged several far-sighted approaches. The company manages every aspect of its products, starting from research and development to production, testing, and distribution from its dealerships.
This vertically integrated approach to manufacturing has made it possible for Tesla to keep down costs, concentrate its expertise, maintain quality, and simplify logistics.
Tesla also employs an excellent supply chain strategy. It not only produces EVs and various associated parts and accessories but also operates a charging station network called Supercharger.
Better Reliability
One of the biggest concerns of potential EV buyers is reliability. Every time a car breaks down, its owner has to shell out money to repair it. Thus, most drivers interested in trying out an EV want one that is as reliable as their old gas-engine or diesel-engine vehicle.
So it doesn’t help when some EV models develop various problems. For example, the Chevrolet Bolt has been the subject of many recalls in the past few years.
Fixing problems and improving reliability will increase confidence in EVs. Going back to the Chevy Bolt, GM has installed various fixes for the model. Sales of the Bolt and other vehicles have improved.
New EV models
Manufacturers regularly introduce new models and redesign older units to draw the interest of current and future drivers. New models usually offer unique and unprecedented features to attract more buyers.
Korean manufacturers Hyundai and Kia gained a lot when they rolled out their new all-electric SUVs in 2021. The popularity of the Hyundai IONIQ 5 and Kia EV6 in 2022 drove their sales to the point that their market shares were second only to Tesla.
Meanwhile, Ford is ramping up production of the F-150 Lightning, the EV version of its light truck. The F-150 Lightning caters to a different crowd than the one covered by the Ford Mustang Mach-E.
Ford hopes to tap the growing market for electric cars with its expanded lineup of EVs. Furthermore, it chose the F-150, the best-selling vehicle in the US, as the basis for its new electric vehicle. This will not only attract the interest of EV buyers but also target the same demographics that buy the F-150.
As the US moves away from internal combustion engine vehicles to reduce emissions and reliance on fossil fuels, its EV market will assuredly grow. The rise of electric vehicles will come with associated developments, such as the expansion of the existing EV charging station networks.
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