In February, the registration of electric vehicles in the United States saw a 25% decline, marking a reversal from the continuous growth trend in recent years, with Tesla's registrations taking a significant hit.
Data from S&P Global Mobility shows that Tesla's new car registrations in the United States dropped by 25% compared to the same period last year, leading to a 2.8% decline in the total electric vehicle registrations for the month in the U.S. It's noteworthy that Tesla last experienced a year-on-year decline in monthly new car registrations in August 2020 (a 2% decrease), when the U.S. electric vehicle registrations also slid by 6%, marking the last overall decline before February this year.
Specifically, in February, the total electric vehicle registrations in the U.S. fell by 2.8% to 78,361 units. In comparison, new car registrations for all types of vehicles in the U.S. totaled 1.28 million for the month, an 11% increase from the same period last year when it was 1.15 million. In the U.S. light vehicle market, the penetration rate of electric vehicles dropped from 7% in February last year to 6.2%.
In February, Tesla registered 36,697 vehicles in the U.S., down from 49,209 in the same period last year. Tesla's market share in the U.S. electric vehicle market declined from 61% in February 2023 to 46.8%, although it remains the top-ranked in registrations.
The main reason for Tesla's decline in registrations is attributed to the Tesla Model 3. In February, Model 3 registrations plummeted by 73% year-on-year to 4,434 units; Model Y registrations dropped by 6.7% to 28,664 units; Model S sedan registrations decreased by 1.8% to only 501 units; Model X registrations surged by 47% to 2,537 units; and the Cybertruck had 561 registrations in February, totaling 633 units for the first two months.
Analysts point out that starting January 1st this year, Tesla Model 3 lost its $7,500 federal subsidy eligibility, and Tesla began introducing new versions at its California factory in the first quarter, which may have constrained supply; while Model Y and Model X qualify for the U.S. federal government's electric vehicle subsidy policy, Model S does not.
Tom Libby, Vice President of Industry Analysis at S&P Global Automotive, stated, "Excluding Tesla, electric vehicle registrations in February grew by 32% in the U.S." The negative impact of Tesla Model 3 on overall registrations was significant, and hybrid vehicles also captured some market share. Hybrid vehicles accounted for 10.8% of the U.S. light vehicle market in February, a 3.4 percentage point increase year-on-year.
Among the top ten electric vehicle brands in U.S. registrations in February, besides Tesla, Volkswagen and Chevrolet also saw declines, dropping by 18% and 62% respectively compared to the same period last year. In contrast, BMW saw a 166% surge in electric vehicle registrations in the U.S., Audi achieved a whopping 93% increase, and Ford, Hyundai, Kia, BMW, and Rivian also experienced significant growth.
Looking at the first two months, total electric vehicle registrations in the U.S. grew by 6% year-on-year, but the market share dropped from 7% to 6.8% compared to the same period last year. In terms of models, Tesla Model Y and Model 3 remain the top-selling electric vehicles in the U.S., the only two electric models with registrations exceeding ten thousand units. Among the top ten electric vehicle models in registrations for the first two months, Ford has two models on the list, namely the Mustang Mach-E and the F series. Additionally, Rivian's R1S model also made it to the list. It's reported that in February, R1S registrations nearly doubled to 1,956 units.
For months, analysts have been warning that the growth in electric vehicle sales is slowing down as mainstream consumers hesitate due to high prices and concerns about range and charging infrastructure.
Ed Kim, Chief Analyst at AutoPacific, a automotive marketing research and product consulting company, stated that early adopters of electric vehicles are mostly consumers willing to pay a premium for new technology. "Cost is a significant factor, and in the mainstream market below $35,000, consumers don't have many options."
Kim believes that unless products can better meet consumer preferences and budgets, electric vehicles won't see robust growth again, and this could take several years. "The long-term solution is for automakers to develop electric vehicles that consumers want, which is necessary to get the penetration rate of electric vehicles back on track."
