Record high EV market share in the U.S.

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【Summary】The U.S. market share of electric vehicles (EVs) reached a record high in Q3, with sales of 300,000 units, a 50% increase from the previous year. However, Tesla's market share dropped to 50% from 62% as competition grows. Tesla's price cuts have put pressure on other automakers to reduce prices on their EVs. Lower prices and increased options are expected to boost EV demand. Average EV prices dropped to $50,683 in September.

FutureCar Staff Oct 15, 2023 4:22 PM PT

Sales of electric vehicles (EVs) in the U.S. reached a significant milestone in the third quarter, marking a record-breaking period as the number of options available to consumers continues to grow. According to data from Cox Automotive, EV market sales surpassed 300,000 during Q3, representing an almost 50-percent increase from the previous year. Overall EV adoption also rose to 7.9 percent in the same quarter.

Despite this overall growth, dominant EV leader Tesla fell short of analyst delivery estimates for Q3, causing its market share to drop from 62 to 50 percent. The automaker had previously predicted a decrease in production during this quarter due to factory upgrades. Tesla has also been engaged in a "price war" by consistently reducing prices across its lineup throughout the year. Most recently, the prices of the Model 3 sedan and Model Y SUV were cut, following previous reductions earlier in the year. This pricing strategy has put pressure on other automakers to either lower prices on their own EVs or risk losing potential buyers seeking the best deal.

The increase in electric vehicle options and the lower prices are expected to drive up demand. The Cox report showed that average EV prices dropped to $50,683 in September from $52,212 in August. Cox Automotive stated in their report that "higher inventory levels, more product availability, and downward pricing pressure have helped spur continued linear growth of EV sales in the U.S. market."

Despite the decrease in market share, the overall increase in EV deliveries is considered positive for Tesla. The price cuts have brought the prices of the Tesla Model 3 and Model Y below the average car price in the U.S. for this year. Additionally, Tesla's initial deliveries of the highly anticipated Cybertruck are expected soon. Tesla CEO Elon Musk has previously emphasized the company's goal to accelerate the world's transition to EVs and has embraced increased competition as a means to achieve that goal.

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