As the calendar inches closer to the end of the year, 2024 can be regarded as a year in which electric vehicles have solidly established a footing in the U.S. market and beyond.
Whether you like EVs or not, it is hard to deny that they are more present than ever, even as charging infrastructure isn't as developed or convenient as gas stations, and the entry price into these cars is more expensive than their gas-powered contemporaries.
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At the same time, manufacturers ranging from bold startups like Tesla, Rivian, and Lucid to establishment automakers like General Motors and Ford and even more desirable names like Mercedes-Benz, Porsche, and Maserati are contributing to an ever-growing battery-powered cornucopia.
Going into 2025, we project that a few developments in EVs will affect those seeking to adopt one within the next 12 months.
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The "Tesla Exodus" will only get worse in 2025
Whether they release their so-called "Model Q" or not, there are strong indications that Tesla will lose even more market share to their competitors.
According to the latest data from Kelley Blue Book and Cox Automotive, Tesla remains the market leader in the United States. However, their data also shows that its market share has been constantly declining, peaking at 82.5% in Q3 2019 and currently sitting at 48.2% in Q3 of this year.
Similar to the query of which should be applied first, cereal or milk, or whether ketchup belongs on a hot dog, the question of why Tesla's market share has dipped so low has many undefined "right" answers.
But if I can think of any two solid reasons, they are that there is simply too much competition and that Elon Musk is an incredibly polarizing figure.
Let's look at the KBB/Cox data.
Though it sounds like recent history, it is weird to fathom that in 2019, Tesla was 'the' electric car brand. Five years ago, it only sold three different models: the Model S sedan, the Model X SUV, and the compact Model 3.
This trio competed in a narrow United States EV market that consisted of just 7 models from seven distinct automakers long before other startup cars like the Lucid Air and Rivian R1T would begin production in September 2021.
However, fast forward five years, and a lot has changed.
The competition has multiplied and expanded to include major automotive giants such as Hyundai/Kia, Honda, and Toyota. In Q3 2019, General Motors sold just one EV, the Chevrolet Bolt EV, but now GM sells eight across its roster of brands. One of these is a revival of one of its most notorious gas guzzlers: the Hummer.
But while raw sales numbers show that GM sold just 32,095 EVs across its brands in Q3 2024 and Tesla sold 58,423 Model 3s during the same period, it does show that people are going to places other than the shiny Tesla store downtown or at their local mall.
These other locations could be familiar places like their local Chevrolet or Honda dealership, whose offerings could be compelling against Tesla's bestsellers.
Tesla's dependency on a touch-screen for basic functions like adjusting mirrors and wipers can turn off traditional buyers. Still, Chevrolet and Honda's EV offerings offer newfound luxuries like Apple CarPlay, buttons, and knobs to adjust mirrors and climate control settings, as well as physical headlight and windshield wiper stalks.
However, some EV owners' reasons for venturing out and exploring other brands' EVs would be Tesla CEO, owner of social media platform X (formerly known as Twitter), and political activist Elon Musk.
Save the politics talk for social media posts and comment sections like the one below, but real data shows he is actively turning off some EV buyers from the brand.
According to the results of a July poll conducted by the New York Times, many EV owners can't separate Tesla from Musk. His controversial views online have influenced their decision to buy EVs from other brands. Additionally, an August survey by Edmunds found that 36% of car buyers considering an EV said they were turned off Tesla because of Musk.
In remarks to the Financial Times, Florida Tesla owner Loren Repollo noted that Musk's polarizing image online influenced her motivation not to buy another Tesla after her Model Y needed replacing. In spite of this, she bought an "Anti-Elon Tesla Club" bumper sticker for her car and her mother's.
“Once he started getting more involved politically, I was like, ‘Oh my God, I need to sell my car,’” she said. “I can’t have any affiliation with him.”
Bye-bye to electric vehicle incentives
2024 has been a transformative year for EV buying, as a major incentive was made much easier to receive.
On January 1st, the IRS' updated its Code Section 30D, which allowed qualifying buyers under certain income thresholds to get up to a $7,500 tax credit directly applied to the purchase price of qualifying EVs that meet certain sticker price restrictions or up to $4,000 for a used EV priced at or below $25,000 that is at least two model years old.
This move was a clear winner.
By June 2024, data from the U.S. Department of the Treasury and the IRS showed that more than one billion dollars in tax credits had been given to buyers of qualifying EVs and plug-in vehicles since the new rules took effect this year.
However, the fun (and free money) can only last so long. On January 20, the man at the helm of the United States government will be changing.
It may not be the first time around for President-Elect Donald J. Trump. Still, if you have been following the news from his transition team just days after the election, you may get the feeling that this era of his tenure may be wildly different from the period from 2016 to 2020.
In a note published on November 3, Wedbush analyst and Tesla bull Dan Ives predicted that a Trump presidency would be "an overall negative for the EV industry," noting that current EV subsidies, like the tax credits associated with the Inflation Reduction Act, would be taken away once he steps foot into the Oval Office.
Related: Tesla expert reveals post-election scenarios for EVs and Elon Musk
On November 15, a Reuters report exposed a massive possibility of it happening. Citing two sources with direct knowledge, they reported that the transition team is planning to kill the $7,500 IRA tax credit " in meetings by an energy-policy transition team led by billionaire oilman Harold Hamm, founder of Continental Resources, and Republican North Dakota Governor Doug Burgum."
But politics aside, experts believe that if the Trump administration follows through, sales of electric cars will severely plummet.
In a report titled “The Effects of ‘Buy American’: Electric Vehicles and the Inflation Reduction Act,” UC Berkeley professor Joseph Shapiro, Stanford professor Hunt Allcott, and Duke University professor Felix Tintelnot noted that sales of new EVs would fall 27% in a situation similar to what Trump's transition team envisions.
"It's a rapidly growing market and relatively new technology, but [eliminating the federal EV tax credit] is not trivial. I mean, $7,500 is not trivial,” Shapiro told Yahoo Finance.
Although time will tell if it will actually happen, Shapiro's sentiment rings true, as some electric cars are built to a price *with* the IRA tax credit in mind.
For instance, Chevrolet's Model Y-killer, the Equinox EV, has a starting price of $33,600 before the $7,500 tax credit, severely undercutting rivals like the VW ID.4 and Tesla's bog-standard Model Y.
Electric is a commitment. As the last of the early adopters get their EVs, don't be surprised if mainstream buyers — regular people who are the bread and butter of any automaker, will opt for something else like a Prius if they find EVs too expensive.
More Business of EVs:
- The Kia EV9 is crushing the competition
- Tesla's biggest rival has a huge problem no one is talking about
- Move over Ford, this EV might be the new popular police car
Three EVs that I look forward to:
Though the market conditions look bleak, there are a few electric vehicles on the market that, when released in 2025, will impact the industry.
Stellantis
Dodge Charger Daytona Scat Pack EV
The topic of EVs tends to ruffle feathers, but one particular EV that has blown through the whole flock is none other than Dodge's replacement for the Challenger and Charger muscle cars.
If you look at the comments of its reveal video on YouTube, you would think that Dodge was doing a new collaboration limited-edition car with Bud Light that is exclusively sold through Target, as the mere existence of a Dodge Charger with an electrified powertrain has proven to be extremely controversial.
"Truly an awful day to be a Dodge fan. The glory days are over, it's been fun gentlemen," YouTube user @Dhall123 said in the comments.
"Can't believe that I now have to strike off Dodge from my dream cars list," YouTube user @kxtave02 lamented.
But if there is any reason I can give as to why the Charger EV should be taken seriously, I would say its new advertisement helps.
"We aren't building electric vehicles because it's trendy. We're building electric cars to make a difference," the narrator says amidst a b-roll that reflects stereotypical "eco-conscious" advertising tropes.
"To protect our future and our children's future. We're building electric vehicles to save our planet. To save it from all those lame, soulless, weak-looking, self-driving sleep pods everyone else keeps pollutin' our streets with."
Dodge aims for a car that adds to its legacy of building loud, powerful muscle cars that go against the grain of "normal cars." This time, the status quo is going against the likes of Tesla's Model Y, proving that an EV can be fun.
With 670 horsepower, 627 lb.-ft. Of torque and a 0-60 time of 3.3 seconds, there should be no doubt that it will be powerful. However, the challenge for dealers will be to sell it.
In a report back in August, I wrote about Dodge dealers' doubts about being able to sell the newfangled "muscle cars" as they eagerly waited for its gas-powered versions to arrive.
In an interview with Automotive News, Michael Harrington, the general manager of Huntington Beach Chrysler-Dodge-Jeep-Ram in California, warned that the electric Charger's price tag of over $61,000 would be a hard sell for the younger audience who bought the Hemi-powered predecessors.
"I really thought they were going to come out with this nice price plan," Harrington said. "You can buy a Tesla now for [$30,000], $300 a month. We're going to double the price? Just not going to work."
We will have to wait and see.
Hyundai IONIQ 9 takes on the mass-market
On the opposite end of the EV spectrum, Hyundai seems to be positioning itself as the mass-market "anti-Tesla" as it rounds out its IONIQ line of electric vehicles.
Riding on the same platform as the similarly-sized Kia EV9, it is the electric alternative to Hyundai's big SUV, the Palisade.
But while the SUV sports a large, boxy look akin to Chevrolet's Tahoe or GMC's Yukon Denali, the IONIQ 9 looks more like a curvy, more aerodynamic version of a jacked-up early 2000's Volvo station wagon.
However, unlike the station wagon, Hyundai took full advantage of the space that can be used inside an electric vehicle. It has everything you like in a minivan (and more!) without dealing with the embarrassing, emasculating feeling of driving a minivan or a much more expensive Rivian R1S or Tesla Model X.
Room for seven fully-grown adults? It's got it. Second-row heated and cooled reclining captain's chairs? It's got it. Apple CarPlay and Android Auto? The Rivian and Tesla don't have it, but the Hyundai does.
With few competitors besides its Kia stablemate, Hyundai is one of the few choices for families in a narrow market.
"There aren't many 3-row electric SUVs on the market, so this is a big deal," YouTuber Doug DeMuro said during a walk around of a prototype version of the IONIQ 9.
Chevy Bolt aims to win the entry-level EV market
On its investor day on Oct. 8, General Motors President Mark Reuss took a jab at Ford and bragged that GM could lower EV costs by reducing the number of parts in its vehicles to make them cheaper.
“We don’t need to create a skunkworks to create affordable electric vehicles," Reuss said. "We know how to do this."
Reuss took this shot at Ford while teasing the 2026 Chevrolet Bolt. But while the visuals were withheld from the webcast, Reuss reassured that the newest version of its small EV will have "the latest technology" from the automaker.
Related: GM exec takes potshot at Ford CEO's "secret" EV strategy
Few details about the Bolt's capabilities have been shared, but Reuss noted that the new Bolt will charge faster than the model it took off the market. With DC fast charging, the Bolts on the road can add 100 miles in 30 minutes.
One thing is certain: it will be cheaper than rivals like Tesla. Reuss noted that buyers can expect the new 2026 model year Bolt to be slightly more expensive than the outgoing Bolt EUV, which starts at $28,795.
However, the GM executive said, "It will just be one member of a family of Bolts, including an even low-cost option."
Given Tesla's off-again, on-again teasing of a cheaper model than the Model 3 (which culminated in a so-called announcement of a "Model Q"), General Motors' entry into the cheap EV game may be all it needs to effectively make itself a more valid threat against Elon Musk's golden elephant.
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