Forecasting Consumer EV Demand
The latest fluster around consumer EV demand — leading to automakers from Ford to GM to Mercedes-Benz (and others) to pull back on EV plans — makes one wonder if automakers would benefit from better forecasting of customer demand.
Obviously this is a complex exercise, but just for fun let’s take a look at EV adoption data from California to see if we can identify any interesting trends. Please keep in mind that in these graphs, correlation may not equal causation, and sometimes we’ll see adoption of certain things because no other choices exist (*ahem cheaper EVs*).
Let’s start from the top and plot total sales across the state. Interestingly, we see that light-duty vehicle sales peaked in 2018 and has been on a downward trend since! At the same time, zero-emission vehicle (ZEV) sales have been steadily climbing. As a result, we see an exponential growth in the sales share of EVs — up to 25% in 2023.
But California is not a homogenous state, despite what its state-level politics appears to be. If we look at the top and bottom counties according to EV adoption, we see all top 5 counties residing in the San Francisco Bay Area (Santa Clara at 42%, Alameda at 40%, Marin at 38%, San Francisco at 37%, and Contra Costa at 33%). The bottom 5 counties, with the exception of Colusa County, are all on the edges of the state.
What are some of the factors that influence EV adoption? (Again, this may simply be correlation, not causation.) First, let’s take a look at EV adoption vs. charging infrastructure. If we total L1, L2, and DCFC deployments, we see a fairly suggestive trend — no surprise here!
But some of these are more correlated than others — for example, public L1 charging doesn’t do much (not hard to imagine why!), while public DCFC deployments appear the most strongly indicative.
Which auto brands are doing the best? Tesla dominates unsurprisingly, but it was rather shocking to see the difference visualized.
If we ignore Tesla and look at the up-and-comers, we see a pretty close race among GM, Ford, Mercedes-Benz, BMW, and Hyundai. If you combine Hyundai/Kia, the South Koreans eclipse everyone except Tesla. Volkswagen is lagging, although combined with Audi they’re still in the running. And Rivian is punching far above its weight.
What about price? We’ve seen the greatest adoption of vehicles in the $40–60k range, likely driven by Tesla’s Model 3 and Model Y. Luxury vehicles in the $60–80k and $80k+ range dropped off in 2023, potentially due to higher interest rates and saturated demand, which would explain the struggles of Mercedes-Benz and Lucid.
Among the lowest adoption is of EVs under $30k, but remember this doesn’t necessarily mean people are not interested in cheap EVs — it could simply be that very few competitive options exist in that price range. From online forums, it appears that the Chevy’s Bolt has experienced a resurgence of interest post-facelift, with numerous fans disappointed that GM is cancelling the option before a refreshed version is available.
Finally, let’s take a look at vehicle body types — i.e. sedans vs. trucks. The appeal of crossovers/SUVs is evident here, which is probably some combination of consumer demand for practicality and automakers deciding to build larger/more expensive EVs first. However, it’s worth asking if we do need to continue the trend towards increasingly large/heavy vehicles like the Cybertruck or Hummer EV (and their combustion counterparts) — even the Rivian R1T drew concern for overwhelming standardized highway guardrails. But hey, this is America and choice is a good thing! It’d just be nice if the choices included coupes, convertibles, and vans as well so we weren’t fighting size/safety crash wars. (More on what we should be optimizing for here.)
Hopefully you enjoyed this quick tour of California’s EV trends. Is this something you’re interested in? What else would be useful? Feel free to share your thoughts.
