Low Plug-In EV Sales in 2019, but Growth Ahead for the US

As 2019 winds down, the US plug-in EV (PEV) market is showing signs of slowing. PEV sales in the US through 1H 2019 were outpacing 1H 2018 sales by nearly 20%, but third quarter sales were down over 20% compared to third quarter 2018. This sales dip is leaving automakers and EV advocates hoping for strong fourth quarter sales to avoid a year-over-year sales decrease for a market that shows strong growth indicators. Lower sales in 2019 would not be a positive sign for those investing heavily in EV technology and infrastructure. While seeming to potentially slow market investment and stall further market growth, this lull is expected to cease due to the large number of vehicles coming to the US market in 2020 and supportive PEV policies.

Tesla Continues to Define US Sales

Tesla is leading the way in US PEV sales, with over 57% of sales being Tesla vehicles through the third quarter. The Model 3 itself accounted for a staggering 47% of sales. The Toyota Prius Prime is maintaining its hold as top selling plug-in hybrid EV (PHEV) in the US market with over 15,000 sales through the third quarter, 7% of the US PEV market.

Continued Growth Through the 2020s

Guidehouse Insights's report, Market Data: EV Geographic Forecast - North America, states that US PEV sales are expected to reach over 2.3 million by 2030, with over 17 million PEVs on the road. Despite slowing growth in 2019, the US PEV market is expected to pick up again in 2020 and beyond. This growth comes with the introduction of a new zero emission vehicle state, continued investment in charging infrastructure by many stakeholders (including utilities), and the availability of new PEV models. 

The PEV models available in the market may be one reason for the slowing sales growth rate as consumers are looking for bigger vehicle models. Over 14 new PEV models enter the US market in 2020 and over half fall into the light truck category—large crossovers, SUVs, and pickup trucks. Light trucks are the largest vehicle segment in the US market (as consumers want larger vehicles), but to date, have lacked in PEV models (particularly from economy brands). Tesla’s Cybertruck announcement on November 21 has already yielded over 200,000 pre-orders for the vehicle, despite its launch date of late 2021.

Don't Let 2019 Fool You

US PEV sales have not seen the anticipated growth so far in 2019, but there is still hope for a strong finish. Typically, the fourth quarter of a year sees high PEV sales; in 2018, 35% of PEV sales took place in the last quarter of the year. Despite lower than expected 2019 sales so far, there is a chance for the market to show big gains in the last quarter.

Defined by the expansion of model types for the PEV market, 2020 is likely to see higher growth rates than 2019 because of new PEV models. Consumers may be waiting for these new, larger PEV models to come to market before purchasing a vehicle.