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US EV Sales Likely Hit 26,000 in June

The big surge in electrical vehicle sales within the U.S., primarily driven by clean energy leader Tesla, continues.

According to reports from Inside EVs, total U.S. EV sales are likely to hit near 26,000 for the month of June. Such sales increases have primarily been driven by Tesla — which sold over 11,000 EVs in the U.S. for the month — representing nearly half (42 percent) of the entire U.S. market.

(Unpacking why EVs are so important to confronting climate change.)

Tesla’s dominance was spear headed by its Model 3 — which sold over 6,000 in June to the U.S. (and approximately 2,000 to Canada). Meanwhile, combined Model S and Model X sales were in excess of 5,000 in the U.S.

Other U.S. clean energy vehicle leaders for the month of June included Toyota Prius Prime (a plug in hybrid electrical vehicle), the Nissan Leaf, The Chevy Bolt and the Chevy Volt (plug in hybrid). In total, all of these four models combined represented less sales than Tesla — approximately  5,900 in total or about 55 percent of Tesla’s sales. Of these, only the Prius Prime cracked the 2,000 mark (see more here).

(U.S. EV sales are rapidly increasing in 2018. Image source: Inside EVs.)

Overall, it appears that U.S. EV sales are likely to hit near 400,000 on the back of Tesla’s rapid expansion in production rates. In addition, GM has recently acknowledged that it is unable to meet high demand for the Bolt in the U.S. and has stated that production lines are set to expand by 20 percent. Though this is unlikely to satiate rising EV demand, it will add to the widening trend of ramping clean energy sales here.

GM recently saw big Bolt sales gains in South Korea. And the company recently acknowledged that it is not doing enough to meet consumer’s clean energy needs in North America. Though a bump from 26,000 to approximately 31,000 Bolts sold from 2017 to 2018 is a drop in the bucked compared to the approx 100,000 or more new EVs Tesla will be adding by itself vs 2017 (100,000 total EVs in 2017 to approx 200,000 total in 2018).

(Tesla hits past 5,000 Model 3’s per week in late June and early July. Image source: Bloomberg.)

Looking ahead, Tesla appears set to sell well in excess of 10,000 Model 3s alone in the U.S. in July as weekly production rates surge. According to Bloomberg’s Model 3 Tracker (image above), the company has sky-rocketed weekly Model 3 production rates to above 5,000 during late June and early July. And while some wag is likely between the mid 2,000s to mid 5,000s as Tesla continues to work on its lines, the company is on a clear path for increased production — aiming at another surge to 6,000 per week by August.

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Racing to Catch Ludicrously Fast Model 3 Production Ramp, U.S. Automakers Grew EV Sales by 102 Percent in June 

Early on, Tesla recognized that responses to climate change were necessary — not just from individuals and governments, but also from industry. And Tesla realized that, when mated with wind and solar energy, electrical vehicles could become a powerful force for driving an energy transition capable of rapidly cutting global carbon emissions.

(Reduction in coal burning and lower than predicted demand for fossil fuels has helped to generate a carbon emissions plateau during 2014 to 2016. Rapid additions of renewable energy sources like wind, solar, and electrical vehicles provides a potential to begin to bend down the global emissions curve near term and reduce the damage that is now being locked in by fossil fuel based carbon emissions. Image source: IEA.)

Tesla’s Market-Driven Response to Climate Change

Electrical vehicles possess a number of key sustainability advantages that aren’t widely talked-about in the public discourse. Electrical motors are considerably more efficient than ICE engines — so broadening EV use lowers energy consumption in transportation while at the same time allowing EVs to draw power from traditional and newly emerging renewable sources. The massive batteries housed in EVs and sold after-market also have the capacity to become a major solar and wind energy storage asset that could ultimately enable the removal of peaking, high emissions, coal and gas plants.

In light of these opportunities, back in the mid 2000s, Tesla made a bold, necessary move. Its leadership decided that it would attempt to become a major automaker dedicated solely to electrical vehicle sales. This business plan would hitch Tesla’s economic future entirely to the success or failure of clean energy ventures. Unlike most present automakers, Tesla would not suffer from divided loyalties to harmful incentives linked directly to fossil fuel based economies. It decided to make its clean energy break by producing top of the market, high-quality electric-only vehicles and, then, by leveraging loyalty to a superior brand, move vertically down into broader market segments.

(If Tesla’s planned Model 3 production ramp to 5,000 vehicles per week by end of 2017 holds true, then the all-electric automaker’s quarterly deliveries are about to go exponential. Image source: EV Obsession.)

Such a disruptive end run on the world’s energy and vehicle markets was bound to encounter stiff resistance and loud detractors. However, if successful, Tesla would force traditional energy and transport players to make a tough choice — follow in Tesla’s footsteps and try to compete, or face dwindling customer bases as a massive wave of innovation completely upended markets. The automaker decided that the best way to goad a broader transition toward electrical vehicles in western markets was to lead it. And that’s exactly what Tesla has been doing.

Major EV Sales Growth on Tap for 2017 Due to Automaker Shift + Model 3 Sales

In the U.S., during 2017, the trend of an emerging industry reaction to Tesla is becoming quite clear. The major automakers are all in a scramble as the imminent arrival of the Model 3 nears. The vehicle, which begins production this month, aims to provide very high quality, Tesla’s trademark swift acceleration, top-notch tech, groundbreaking automation, and 215+ miles of all-electric range for a 35,000 dollar base price. An offering that is disruptive due to quality and accessibility alone. But add to it the 400,000 + preorders that Tesla has accumulated and you’ve got what basically amounts to a volcanic eruption in the global auto market.

In large part, as a response to Tesla’s market-transformation plan, a number of major automakers are deciding to provide their own competing offerings. This year, GM beat the Model 3 to the start line with the 200+ mile range, high-quality Chevy Bolt. Toyota, launched its competitively-priced Prius Prime plug-in hybrid. Nissan redoubled efforts to position its best-selling Leaf all electric vehicle even as it announced plans for a 200+ mile range version in 2018. Meanwhile, Volvo plans to electrify all its vehicles by 2019.

(Increasingly attractive EVs and plug in hybrids like the Chevy Bolt, the Prius Prime, and the Nissan Leaf helped to boost U.S. electrical vehicle sales in June as automakers gear up to compete with Tesla’s Model 3. Image source: InsideEVs.)

This activity has generated considerable growth in sales as customers discover electrical vehicles of ever-increasing variety, value and capability. During June of 2017, all-electric vehicle sales from major automakers in the U.S. market (excluding Tesla) increased by more than 100 percent over June of 2016 on the back of the entry of attractive, highly-capable models like the Bolt. Meanwhile, plug-in hybrid sales grew by 11.5 percent. Total U.S. EV and plug in hybrid sales for the month from major automakers + Tesla hit a new record in June of 17,182 on the back of major automaker sales growth (a total growth of about 16 percent for the entire U.S. market).

Tesla, on the other hand, showed slightly lower June 2017 sales vs June 2016 in U.S. markets as it experienced a hiccup in 100 kw battery pack production. But with the Model 3 nearing launch, an explosion of EV sales from Tesla is in the offing over the coming months. According to statements by Tesla CEO Elon Musk, the ground-breaking vehicle is expected to trickle into the market by adding about 30 sales in July. By August, deliveries are expected to triple to 100. By September, another 1,500 or so Model 3s are expected to arrive. Production will then, according to Musk, swiftly ramp up to 20,000 per month by December.

If these ambitions bear out, and if about half of Model 3 sales are in the U.S., then the U.S. could see north of 40,000 EVs and plug in hybrids sold in the U.S. during December. This would represent a 60 percent + jump over the all-time record EV sales month of December 2016. But even if Tesla’s extraordinarily ambitious production ramp-up goals for the Model 3 aren’t reached by December, the excitement surrounding the vehicle is likely to continue to spur growth and competition in the larger EV market through the period. And that’s a bit of much-appreciated good news for those of us who are increasingly concerned about climate change.

Links:

Big Auto’s Fully Electric Car Sales Up 102% in USA

Plug-in Electric Sales Report Card

Next Generation Leaf to Have 215 to 340 Mile Range

Volvo Electrifying All Models By 2019

CO2 Emissions Flat for Third Straight Year

EV Obsession

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