The last few months, the likes of Fox News and random YouTube channels have been going on and on about lowering EV demand. Like all reports depending on if you focus on the last few months or the last year EV sales are slowing or growing. At the same time interest rates are intentionally high to cut demand across the board. So is the recent slow down due to prices or general lack of interest in EV’s as a concept?
Also why do so many reports tend to exclude Tesla? These reports should be labeled “Non-Tesla EV.”
EV’s aren’t the only vehicles on YouTube that “aren’t” selling. My feed is full of videos of how trucks are piling up at dealerships. Actually watching the video below it seems Ford can’t sale any trucks, EV or otherwise.
Just for fun, I want to write about my theory of the market dynamics and predictions for 2024. We’ll see if I am right in a year.
EV’s are still seen as a luxury product. When money started getting tight over the last few years people started buying fewer wants and more needs. This means as things tighten EV sales, and expensive trucks, will be the first to suffer. The good news is that price increases are slowing down and the Fed plans on dropping interest rates. On the flip side, EV discounts from the government will end for many vehicles. Perhaps this is why GM and Ford are saying the IRA is too aggressive.
Some of the technology is about to change. As far back as June, car manufacturers have started announcing they are changing their charging port. GM and Ford are rumored to have access to the Tesla network through an adapter in February with cars from Hyundai shipping with NACS ports at the end of 2024. GM cars will have the port in 2025. Thanks to adapters I do not think having a CCS port on your car will be the end of the world, but I am not most people. Remember my first theory, EV’s are seen as luxury items. If you’re going to spend $40k+ on a vehicle, why buy one that is going to require you to hassle over an adapter?
Justified or not there is a ton of fear, uncertainty, and doubt over EV’s on social media and traditional media. The common theme, is that EV’s catch on fire a lot, take forever to charge, don’t go far enough, and are overpriced. As with everything there are grains of truth in some of these but the attention economy will naturally blow all of these out of proportion… for the clicks. Other times however the news is outright wrong. But that doesn’t matter, if you repeat something enough, people will believe it. Who knew “the big lie” wasn’t just a concept Nancy Pelosi invented. A good chunk of the US market is being inundated by news suggesting EV’s are bad. That said some manufacturers aren’t helping.
All that said I think 2024 will look different for each of the manufacturers. I am going to predict Tesla will be fine. Sales may have slowed but perhaps buyers are waiting for the highland announced in August. It was doom and gloom around this time last year and Tesla rebounded. I expect orders to pick up in early 2024. The loss of incentives would hurt but Tesla has only had them for a year and was doing well without them. As interest rates drop I expect sales to accelerate.
I worry Ford, GM, and Stelantis are in for a world of hurt in 2024. Buyers will be reluctant to buy an EV with a CCS port if NACS is around the corner. This means ALL legacy manufacturers with see reluctant buyers through 2024 until they start shipping cars with NACS ports. To make matters worst many of these vehicles will not qualify for tax credits which doesn’t help when they’re losing out to Hyundai who didn’t qualify to begin with. I am not sure if even interest rate cuts will save them. That said expect Fox News to dance on the grave of their EV’s. Ford’s problems seem to extend beyond EV’s. Possible bankruptcy/bail out? Expect Fox to blame Biden if that happens.
Hyundai will be fine. They make good EV’s and are VERY popular. I see Ioniq 5’s all of Austin, TX. The main thing hurting Hyundai may be the CCS/NACS transition. There are no tax incentives for them to lose and they may benefit if the Fed finally cuts rates. However, if Hyundai doesn’t get their processes and procedures for service in order there could be bad press in their future.
It will be an interesting year given changes in tax incentives and interest rates. At the same time I suspect boring as EV’s become more mundane than they were this year. Perhaps Fox News will have another culture war topic to harp on.