Tesla may be in a decline in sales, but electric vehicles are doing well overall

Just a few days until 2025, Electric vehicles We’ve already had a roller coaster ride for a year. last week, Tesla The bumpy ride began when it reported that, for the first time, the American electric vehicle champion delivered fewer vehicles globally than the previous year. The automaker delivered 1.789 million vehicles in 2024, down 1.1 percent compared to the 1.808 million delivered in 2023. Tesla shares fell 8 percent on the news.

Then, on Friday, more annual sales numbers came in, and the electric car story got rosy around the edges. GM It said it sold 50 percent more electric vehicles than last year, with the Chevrolet Equinox EV SUV leading the trend. The Honda Prologue EV, which went on sale mid-year, moved 33,000 units — a coup for the Japanese automaker’s electric debut in the United States. until Fordwho said last year that he would do so It has backed away from its plan to increase sales of all-electric cars In favor of a mix of electric, hybrid and gas vehicles, more than 50,000 vehicles were sold Mustang Mach EQ.

Global EV sales numbers likely won’t be fully compiled until next month, but analysts say that in the US, EVs appear to be on track to make a very reasonable 8 percent of all car sales in 2024.

So maybe the “roller coaster” is a bit exciting. By many measures, the EV sales story — and even the Tesla subplot — is mostly playing out the way everyone in the industry thought it would. In the first part of the decade, “people thought there was going to be this crazy growth in electric vehicles,” says Stephanie Brinley, principal auto analyst at S&P Global Mobility. “It wasn’t realistic. The way we see the market developing is more realistic.

“Everyone continues to move slowly,” says Corey Cantor, a senior associate who covers electric vehicles at BloombergNEF.

Lukewarm optimism

No one said the transition to electric cars would be easy. The transition to electrification “has been one of the biggest changes the auto industry has ever seen, and the auto industry doesn’t change overnight,” says Evan Drury, insights director at Edmunds, an automotive website.

Manufacture of an all-new powertrain — and sources The battery metals needed to activate it are only half the challenge. Changing people’s buying habits, especially for one of the most expensive purchases they make in their lives, will be the other half. Given these limitations, Drury says, “It’s remarkable that we’ve seen a lot of change.”

Even Tesla’s bump in the road could be seen as evidence of what CEO Elon Musk’s automaker is doing. Something right. In 2006, Musk published his book “Master plan“which defined Tesla’s ‘overarching purpose’: ‘to help accelerate the transition from a hydrocarbon extraction and burning economy to a solar electric economy, which I believe is the primary, but not the exclusive, sustainable solution.’” Tesla’s annual growth challenges stem, in part, from From the fact that the maneuver was successful, there is now much greater global competition in the field of electric cars, and Tesla officially lost its title as the largest electric car maker in the world last year to the Chinese company BYD, which produced about 4,500 additional electric cars this year. The past (Tesla still Sold More electric vehicles, with a Serious help From Chinese buyers, who bought 8.8 percent more of the automaker’s electric vehicles last year than in 2023.)

Whether the global vehicle electrification project will stay on track depends partly on politics. In the United States, electric car sales jumped in the last quarter of the year. This may be because consumers have heard about the Trump administration’s new plans to eliminate electric vehicle incentives They took expert advice to buy new cars when they could still get subsidies. What will happen in 2025 if these purchase incentives disappear?

Even as more sales figures emerge, the 2024 numbers appear to show the industry is progressing as it should. “It’s a crazy shift,” says Brinley, the electric vehicle analyst. But she’s confident: “We’ll see more adoption,” she says.