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Another Record Month for U.S. Electrical Vehicle Sales as Tesla Struggles with Model 3 Ramp

Electrical vehicles are a key element of the clean energy revolution. They are more efficient than fossil fuel driven vehicles; they produce zero particulate tailpipe emissions. When mated with solar and wind, they produce zero carbon emissions in operation. And they can serve as storage units for renewable energy sources all as their mass production drives the net cost of batteries continually lower.

So if you’re worried about climate change, and you’re well informed (not misinformed, confused, or focused on various shiny objects presently circulating the media), then you’re really interested in seeing electrical vehicle adoption hitting a high ramp in the near future. For those in this group, the October U.S. electrical vehicle report should serve as some hopeful news even as federal action under President Trump tilts more and more toward extreme anti-climate change response policy.

25th Consecutive Month of Record U.S. EV Sales

According to Inside EVs, plug-in electrical vehicle and hybrid sales saw their 25th month of consecutive record gains. About 14,598 electrical vehicles sold during October — which was 33 percent greater than during October of 2016. The yearly total for the U.S. during 2017 is now 157,039. This roughly matches 2016’s accumulated sales from January to December of 158,614. Given present trends, and given the fact that EV sales tend to ramp up during November and December, it is likely that U.S. numbers will hit near or slightly above the 200,000 mark by year end.

(U.S. Electrical Vehicle Sales During October. Image source: Inside EVs.)

GM’s Chevy Bolt rocketed to the top of the list for the month with 2,781 sales. The Bolt has benefited from broader dealer availability and appears to be riding the wave of excitement produced by the Model 3, which is still not available in the mass market. The car is also low-cost, long range, and extraordinarily well reviewed — despite lacking the larger charging network support available to Tesla owners. Annual Chevy Bolt 2017 sales still lag behind that of Tesla’s market-leading Model S — with 20,750 sales for the Model S and 17,083 sales for the Bolt.

The second best-selling plug-in car during October was Toyota’s Prius Prime at 1,626. Toyota’s plug-in electric hybrid has also been very well reviewed by buyers and features a range extending gas engine that completely removes range anxiety (although this is less of an issue for Teslas and the Bolt which presently boast ranges in excess of 200 miles).

Chevy’s Volt takes up the third spot on the heels of the Prius Prime with 1,362 sales. This hybrid boasts a longer electrical range than Toyota’s Prime and the position of an established leader in the field. However, the Prime’s popularity is now giving the Volt a run as top plug-in-hybrid with annual sales neck-and-neck between the two at 16,710 (Volt) and 16,682 (Prime) respectively.

Tesla’s Model S and X vehicles rounded out the 4th and 5th spots for the month with 1,120 (S) and 850 (X) U.S. sales. For the year, Tesla’s Model S is still the top selling EV with 20,750 U.S. sales and the Model X is the 4th best selling U.S. EV with 16,140 total sales. Tesla sales efforts tend to follow an uneven track with greater sales pushes toward end-quarter. So Tesla’s October lag is par for the course for the company which saw a record 3rd quarter of 2017 with 26,150 cars sold globally during July, August and September. To match this level, Tesla total sales will have to ramp during November and December. However, it is worth noting that sales of Tesla EVs have grown significantly in places like Europe during recent months — hitting 4,662 in Europe during September alone.

Aspirational Tesla Struggles to Meet Vision of Mass EV Production

Tesla is presently struggling to ramp up production of its highly sought-after, signature Model 3. With upwards of 500,000 reservations, the nascent company is seeking to make a leap to major automaker status on the platform of an electrical-vehicle-only line. Tesla bet on a highly automated line and a simplified design to achieve a rapid Model 3 ramp to meet this demand and to ensure cash flow into 2018. However, issues with suppliers and with managing such a high level of automation has caused the Model 3 production ramp to splutter. In total, reports estimate that around 405 Model 3s have been produced through the end of October with 145 produced that month. Tesla, acknowledging difficulties, has rolled back its production ramp by 3 months — aiming for 5,000 Model 3s per week by March.

(The Tesla Model 3. Image source: Tesla.)

Our forecast for Model 3 production by end year has dropped to 2,000 with between 75,000 and 200,000 Model 3s produced for 2018. However, if problems with Model 3 production do not soon clear, the total for 2017 could drop to between 700 and 1,000. Hopefully, Tesla can transport itself out of its various circles of mass production hell and avoid such a lag.

Tesla has a history of missing ambitious targets and then catching up with time. Tesla’s Model X production ramp also encountered difficulties, but the all-electric SUV swiftly became a global best seller once production bottlenecks cleared. That said, these are tough signs in a tough time for Tesla, and for those (like this writer) who support the spirit of Tesla’s fully-integrated all-renewable based business model. Renewable energy foes have been emboldened by Tesla’s struggle with Tesla bears making rabid statements almost daily. The next 3-6 months will be make or break for Tesla — determining whether the company falls behind a growing pack of high-quality electrical vehicle producers or whether it continues to be an industry leader. And, in so many ways, Tesla’s success or failure will help to make or break U.S. global renewable energy leadership. For EVs, as a whole, have found new sources of leadership coming from China and Europe even as many automakers invest more heavily in electrical vehicle lines.

Links:

October 2017 U.S. Plug-in Vehicle Sales Report Card

Tesla Record Month in Europe

Tesla Model 3 Delivery Delays

 

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