Global EV Sales Surge 21%, North America Faces 1% Decline

Electric vehicle (EV) sales have seen a remarkable surge globally, increasing by 21% this year. However, North America experienced a contrasting trend, with sales declining by 1% compared to the previous year. This decline is attributed to a combination of policy changes, tariffs, and the conclusion of the $7,500 EV tax credit in the United States.

Between January and November 2023, North America recorded 1.7 million EV sales, falling significantly short of the 11.6 million units sold in China and the 3.8 million in Europe. The data, provided by supply chain analytics firm Benchmark Mineral Intelligence, highlights a troubling trend for the North American market, which has historically been a stronghold for EV manufacturers.

Challenges in the North American Market

The decline in EV sales in the US has raised alarms among automaker executives. In September, Jim Farley, CEO of Ford, forecasted that the market share for EVs in the US could drop to around 5% in the near future. This prediction reflects growing concerns about the current market environment, which has been shaped by a variety of factors, including the end of the federal tax credit for EV buyers.

Benchmark Mineral Intelligence cited the termination of the $7,500 tax credit as a key factor contributing to what they describe as “subdued” sales in the US. Additionally, changes to regulations initiated during the Trump administration have relaxed rules that were previously aimed at fostering the transition to EVs and hybrids. These shifts have created uncertainty in the market, further complicating the landscape for manufacturers.

Global Trends and Competitive Landscape

Despite the challenges in North America, the global EV market is thriving. China’s overall EV sales rose by 19%, with the country leading the world in total sales. In October, BYD, China’s largest EV manufacturer, achieved a record for EV exports, although it faced increased competition from local startups in its domestic market.

Meanwhile, Tesla, the world’s most valuable automaker, has encountered difficulties across its major markets, yet managed to navigate the October sales drop better than many of its competitors. Nevertheless, Tesla is racing against time to avoid a second consecutive year of declining sales.

Other US-based EV manufacturers, including General Motors and Rivian, have also reported a slowdown in demand, leading to layoffs in recent months. These developments underscore the challenges facing the North American EV market, even as global demand remains robust.

According to Charles Lester, data manager at Rho Motion, the Benchmark subsidiary that produced the report, “Overall, EV demand remains resilient, supported by expanding model ranges and sustained policy incentives worldwide.” This statement reflects a positive outlook for the global EV market, even as North America grapples with its unique set of challenges.