US Takes Second Place in Global Electric Vehicle Market Behind China

For a long time, the US has been trailing behind Europe and other areas in the adoption of electric vehicles. However, this is no longer the case. According to Counterpoint, EV sales in the US surged by 79% YoY in Q1 2023, enabling it to surpass Germany and become the second-largest electric car market globally. The only market that is larger is China, as per the analyst group.

Tax credits for electric vehicles are believed to have played a “crucial role” in boosting sales and may have helped the US auto industry as a whole. According to Counterpoint, sales of combustion engine cars were at a record high, electric cars were on the rise.

It won’t surprise you to hear what brands are ahead. Tesla’s share of electric car sales in the fourth quarter was 62.7 percent, with Model Y and Model 3 taking the top two spots. GM was a distant second, with the Bolt EUV and regular Bolt pushing it to 7.6 percent. Volkswagen had 6.3 percent of the market thanks to the ID.4. Plug-in hybrids are a different story – Stellantis owns nearly 43.9 percent of Jeep’s PHEV Wrangler and Grand Cherokee models, as well as the Chrysler Pacifica minivan. BMW was next with 16.1 percent with the X5, and Toyota’s RAV4 helped push it to 15.4 percent.

Counterpoint is optimistic about American electric car sales. Although the revised rules narrowed the list of cars eligible for tax credits, they are still poised to affect demand. The early stages of economic recovery can also help generate interest. It is added that increasing domestic production of some electric cars, such as the VW ID.4 and future Hyundai models, should expand the range of eligible cars.

Sales of electric cars were on the rise at one point. States like California and New York require all new car sales to be electrified by 2035, and manufacturers like GM have already committed to going all-electric around the same time. If this analysis is correct, however, the acceleration of growth is already underway.