The US market for electric vehicles reached record highs in 2018, with new registrations more than doubling year-over-year, according to a new analysis. But will the market continue to double and what factors will play a role?
The numbers come from intelligence firm IHS Markit, which found that while new electric vehicle registrations were “just over 100,000” in 2017, that number reached 208,000 in 2018.
California was unsurprisingly the biggest driver of new EV registrations, as 46 percent of all new US EV registrations in 2018 were attributed to the state. In total, 59 percent of new registrations came from California and the nine other states which have adopted the Zero Emission Program — Connecticut, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon, Rhode Island and Vermont.
With more all-electric models on the way, IHS Markit predicts that more than 350,000 new EVs will be sold in the US in 2020, for a 2% share of the market. The firm also believes that by 2025, 1.1 million EVs will be sold in the US for a 7% total share. IHS Markit powertrain analyst Devin Lindsay said,
“A rapid increase in EV nameplates is the catalyst behind the projected growth throughout the next decade. While relatively successful models such as the Tesla Model 3 mature in the market, other traditional automakers will be rolling out not just one EV as we have seen in the past, but multiple models off dedicated EV platforms.”
IHS Markit also found loyalty rates for EVs are on the rise, as almost 55% of new EV owners acquiring a new car during Q4 2018 chose another EV, up from 42% in Q3 2018. That loyalty number leapt to 70% in January.
It’s not surprising to see the majority of growth coming from California and the other ZEV states. But if more than 4 out of 10 new registrations came from non-ZEV states, that’s a pretty decent indicator of strong nationwide interest and not just based on compliance cars (ahem Andrew Wheeler).
With just about every automaker slated to introduce new EVs in the coming two years, sinking battery costs, production scaling up…with more and more attention being paid to programs like the Green New Deal, not to mention efforts to expand the EV tax credit, some of them bipartisan…it feels like a big shift is right around the corner.
We know Tesla’s Model 3 has pushed EV sales in California (and the US in general) — data showed 51,293 Model 3 registrations in 2018. What will happen to the growth rate when Model Y hits the market? Even conservative estimates have EVs grabbing 7% of the market by 2025, and half of the market by 2040 or earlier. But if the doubling trend continues unabated or even increases, we could see adoption reach critical mass a lot sooner — just like in Norway.
FTC: We use income earning auto affiliate links. More.
Subscribe to Electrek on YouTube for exclusive videos and subscribe to the podcast.