Tesla
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For the first time since the electric vehicle giant popularized battery-powered cars, its market share has fallen below 50%, which is a good sign for the industry and for Tesla.
EVs are becoming more and more mainstream, which is a good thing for anyone looking to sell an EV.
Americans bought about 330,000 electric vehicles in the second quarter, the most ever and up 11% from the same period last year. This is reassuring: electric vehicle sales in the first quarter were up just 3% from the same period last year, far slower than the 46% increase that will occur in 2023.
Slowing growth in early 2024 had everyone worried. Tesla shares were down 44% in 2024 from their April lows. Part of the reason for the decline was weaker-than-expected first-quarter delivery numbers, which were down about 9% year-over-year.
Currently, Tesla shares are flat so far this year, but are up about 20% after second-quarter deliveries beat expectations. Tesla sold about 444,000 vehicles worldwide in the second quarter, down less than 5% from a year ago.
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Tesla sold about 164,000 vehicles in the U.S., giving it a 49.7% market share. That’s below 50%, but investors didn’t seem to mind. The stock rose after data provider Cox Automotive released its second-quarter market share figures.
One reason for this reaction is that no one expects Tesla to own half the market forever, and another is that EV penetration will need to be much higher in the future for Tesla and other automakers to sell enough battery-powered cars to justify stock market valuations and EV investments.
EV penetration in the U.S. is roughly 8% of new vehicle sales, having hovered around 7% to 8% over the past six quarters.
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But there are signs that Americans are warming to EVs, with more automakers selling significant numbers of them and more affordable options available.
Nine automakers sell more than 10,000 battery electric vehicles in second quarter, Volkswagen
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BMW
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General Motors
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Ford
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Hyundai
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Kia
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Rivian Automotive
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Toyota
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And, of course, there’s Tesla, up from eight a year ago. Toyota, which includes Lexus sales, has also joined the group.
Some premium automakers, including Polestar Automotive, struggled to sell EVs in the second quarter.
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Porsche
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Volvo, Mercedes
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Both companies saw double-digit sales declines in the second quarter compared with the same period a year ago, another sign that the luxury end of the battery electric vehicle market is becoming saturated.
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Kia saw the biggest gains in the second quarter, increasing its market share by about 3 percentage points from last year. Ford, the second-largest U.S. EV maker, increased its market share by about 2 percentage points. GM increased its market share by just over 1 percentage point.
Kia’s number one model in the second quarter was the Kia EV6, which starts at about $43,000. Mercedes’ best-selling EV model was the EQE SUV, which starts at about $75,000, with prices starting at $1,000 more.
It’s a good sign that American buyers are flocking to more affordable options: The right car, at the right price, will sell, whether it’s a Tesla or another company.
Tesla shares fell about 1% last week.
S&P 500
The stock was up about 1%. News that Tesla is postponing its August robotaxi event hit the stock hard; shares fell 8.4% on Thursday. The event is about the future of self-driving cars. Investors care more about that event than quarterly EV market share these days.
Email Al Root at allen.root@dowjones.com.
