EV Stagnation

Mobius Intel Brief:

High relative costs and range anxiety are two sticky problems weighing on US electric vehicle adoption in 2024. Alternative buying decisions indicate incremental upside skew to 2030+ petroleum consumption forecasts.

• Key Intel: KBB data released Wednesday showed US EV buyers spent an average of 16% more on electric vehicles ($56,351) than internal combustion engine counterparts ($48,397) in September. Including tax incentives, EVs’ premium averaged +19% vs. ICE vehicles in Q3. Demand headwinds are appearing in EV adoption rates, coinciding with government-funded research that shows three quarters of IRA subsidies went to buyers who planned to purchase an EV regardless of policy incentives. As a result, the government spent an estimated $32,000 per each additional EV sale.

Monthly light-duty vehicle sales data collected by the Argonne National Laboratory shows total BEV and plug-in hybrid EV sales reached 145,027 in August from 126,464 in July. The robust +14.7% M/M change masks underlying weakness evident upon closer inspection of EV sales rates.

The annualized change in total monthly plug-in EV sales shows accelerated adoption rates from IRA and regional tax incentives faded rapidly in 2024.

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