If tariffs and major policy changes have anything to say about it, 2025 could be a rocky year for electric vehicle sales. But so far, in the first three months of the year, things are looking pretty good.
In the first quarter, EV sales in the U.S. grew 11.4% year-over-year, according to a report from Cox Automotive. Nearly 300,000 new electric cars changed hands during the period, thanks to strong showings from automakers like General Motors, Ford, Honda and BMW, along with a whole bunch of new electric models that didn't exist at the start of 2024.
"Despite many obstacles—and what you may read elsewhere—electric-vehicle sales continue to grow at a healthy pace in the U.S. market," Cox said. In 2024, Americans bought a record 1.3 million electric cars, despite a pace of growth that was slower than the industry had bargained for.
The market as a whole faced an uphill battle this year, given how Tesla—which still represents the largest share of the overall electric segment—has been faring lately. Elon Musk's carmaker saw its U.S. sales fall 8.6% year-over-year to 128,100 units, Cox estimates. The company didn't break out in its regional vehicle sales, but it reported a 13% drop in global deliveries for Q1. Tesla had its worst quarter of sales in nearly three years amid growing backlash to Musk's role in government and a core vehicle lineup that hasn't been significantly expanded or updated in years.
"Without a significant shift in product strategy, Tesla will continue to shrink in the U.S. market," Cox said. The automaker has said it's on track to launch a lower-cost model in the first half of this year, but it's unclear what exactly that is. It also just launched a refreshed Model Y crossover, but it's yet to be seen how much that will lift its sales.
Other automakers were happy to pick up the slack and maybe even a few disgruntled Tesla owners. Most brands saw their EV sales grow year-over-year, per Cox.
Some of the best-performing brands in Q1 included Chevrolet, which saw a 114% surge in EV sales year-over-year on the back of the Blazer EV and Equinox EV. The latter earned our Breakthrough EV of the Year award last year for its bargain-bin price and 319-mile range.
BMW's EV sales grew 26%, largely thanks to the i4 sedan and iX SUV. Toyota nearly tripled its sales of the bZ4X SUV, albeit from a low starting point. Cadillac sales grew 37.4%. Ford maintained its spot as the No.2 EV brand with 22,550 electric models sold.
A slew of new models helped snag more EV buyers in Q1. Some EVs that were on sale in the most recent quarter that weren't on sale during the same period last year include: the Honda Prologue, Acura ZDX, Cadillac Escalade IQ, Cadillac Optiq, Chevrolet Equinox EV, Jeep Wagoneer S, the electric Mercedes G-Wagen and the Dodge Charger Daytona muscle car.
It wasn't smiles all around, though. Mercedes-Benz experienced a 58% crash in EV sales, Cox said. Its EQ line of EVs hasn't resonated with buyers, and a new, reimagined electric portfolio is on the way. Rivian, the California-based EV startup, reported 36% fewer deliveries, which it partially blamed on the wildfires in Los Angeles, a key market.
There are some broader signs of weaker sales growth in Q1's numbers, too. That's been the theme in the EV industry for the last couple of years, as enthusiastic early adopters give way to mainstream buyers who are harder to sell on electrification.
U.S. EV sales slipped roughly 19% between Q4 of 2024 and the latest quarter, according to Cox's estimates. Plus, new electric models that weren't available in the year-ago quarter accounted for roughly 43,000 sales this past quarter. If you only compare the models that were on the market during both quarters, EV sales fell slightly.
Industry analysts expect that electric cars will gradually replace combustion-engine vehicles globally. The big question is how quickly that will happen, and how different parts of the world will make out. Zoom out, and it's clear that demand for electric cars in the U.S. is growing, but outside factors could complicate the country's transition to EVs in the near term.
President Trump's new tariffs on imported cars, car parts and other goods could push vehicle costs higher and put a chill on EV sales. If the Republican-majority Congress eliminates the $7,500 EV tax credit to help pay for tax cuts, that would deal another blow. Cox said the rest of 2025 will likely be "volatile" for EV sales.
"If the new auto tariffs hold, they will pose a monumental challenge for many automakers, particularly due to the tariffs on steel and, importantly for EVs, aluminum," the firm's report said. "Add to that the heavy speculation that the new administration will reverse Biden-era EV sales incentives, and the story for EV sales in Q2 and beyond is murky at best."
Got a tip about the EV world? Contact the author: Tim.Levin@InsideEVs.com
