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Report shows growing divide on EV adoption

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Market Trends
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Electric vehicle sales are up 1% year-over-year for the first half of 2023, but a “stark division is emerging” between states where adoption is growing, and others where it’s stalled, according to a new report.

J.D. Power’s E-Vision Intelligence Report, released Tuesday, indicates that while California is expected to reach 94% EV share by 2035, North Carolina’s EV market share might remain below 20%. Michigan is expected to reach a 41% adoption rate during the same period.

“To the long list of literal and figurative lines of demarcation that illustrate the sharp geographic, political, socioeconomic and cultural divisions between states in the United States, we may now add the EV adopters and the EV holdouts,” J.D. Power said. “…EV adoption in America is growing increasingly divided, with the most active states for EV adoption already on the path to parity with internal combustion engine (ICE) vehicles and consumers steadily pulling back on EV purchases in the least-active states.”

According to the report, EV adoption rates have increased overall, today representing 8.6% of the total new vehicle retail market.

In the top 10 states with the highest overall EV adoption rates — California, Washington, Hawaii, Oregon, Nevada, Maryland, Arizona, Colorado, Utah, and Massachusetts — adoption rates have continued to grow.

Conversely, the states with the lowest levels of EV adoption — Michigan, Iowa, Kansas, Arkansas, Mississippi, Wyoming, Louisiana, South Dakota, West Virginia, and North Dakota — have seen EV adoption drop during the first six months of the year.

Nationwide, EV adoption is expected to reach at least 70% by 2035, J.D. Power said.

Right now, EVs represent 8.6% of retail market share, with Tesla accounting for 63% of year-to-date sales.

EV market share was 8.5% in July, with Tesla representing 63% of that portion.

Elizabeth Krear, vice president of electric vehicle practice at J.D. Power, said in a report last month that with an EV Index score of 52 on a 100-point scale, EVs are more than halfway to achieving parity with gas-powered vehicles.

“Affordability remains the highest-scoring factor at 97, driven by aggressive pricing from Tesla. The three factors of interest, availability, and adoption show modest improvement and infrastructure remains flat,” Krear said. “…Although the affordability factor is approaching parity, it is skewed by the premium market, driven largely by Tesla’s 63% EV market share — and their continual price cuts. In the high-volume segments like compact SUV and large pickup-light duty, affordability scores are at 80. The glaring hole is that no EV options exist in the huge midsize SUV segment.”

Kia, Honda report EV sales increases

Kia said that it doubled its year-over-year EV sales last month and recorded its second-highest sales figure in the OEM’s history.

August also marked the fourth consecutive month Kia has sold more than 70,000 vehicles. The 72,147 vehicles sold last month represent the second-highest monthly total in Kia’s history and a 9% year-over-year increase.

“Exceeding 70,000 units for four consecutive months and doubling year-over-year sales of our electrified offerings is proof that Kia is ahead of the competition and delivering highly desirable and innovative models across many of the industry’s largest segments,” said Eric Watson, vice president of sales operations at Kia America. “Kia’s electrified offerings combined with our rugged and capable SUVs have strategically positioned the brand to not only increase our EV market share but further establish ourselves as the leader in innovative mobility.”

Several of the OEM’s models grew in sales, including the EV6 which grew by 32% and the Niro, available in hybrid and electric, which saw a 1,746% increase in sales.

Kia said four of its models — including the Carnival, EV6, Niro, and Telluride — accounted for 72% of its overall August sales boost.

Other automakers also reported strong EV sales growth, with Honda’s EV models posting record sales in August and exceeding 25,000 units for the sixth consecutive month.

Honda added that its CR-V and Accord hybrid-electric models topped 50% of its sales mix.


Main image: SimonSkafar/iStock

Secondary graphics courtesy of J.D. Power and Kia

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