The electric vehicle market continued to grow thru 2023. According to Kelley Blue Book estimates, a record 1.2 million EVs were sold last year. With EV sales in Q4 2023 setting a record for both total share of the market ( 8.1%) and volume ( 317,168).  In 2023, the EV share of the total U.S. vehicle market was 7.6%, up from 5.9 % in 2022. 

The EV market in the U.S. is still growing, though not as fast as years past. In Q4 EV sales increased year over year by 40%, a decent gain except when compared to a 49% gain in Q3 2023, and a 52% in Q4 2022. By volume, EV sales in Q4 were higher than in Q3 by roughly 5,000 units. 

Two issues, the higher price tag of many EVs and charging infrastructure have been and remain genuine obstacles to more widespread adoption. Things continue to evolve quickly in EV tech, with areas like battery design and cost improving steadily year over year, lowering the overall cost of a new EV. Last month, the average price paid for a new EV was $50,789, according to Kelley Blue Book, down from an average of $53,376 in 2022 and not far off the $49,075 average for a new ICE vehicle in December 2023.

Only two new EV models under $40,000 are available in the U.S: The Chevy Bolt and Nissan Leaf.

Tesla remains the leader in EV sales, but the gap is shrinking. The automaker grabbed 55% of the EV market in the U.S. in 2023, down from 65% in 2022. Tesla’s share increased in Q4 after falling to an all-time low in Q3, bolstered by price cuts and tax credits that Tesla vehicles re-qualified for in early 2023. The Model Y accounted for 33% of all EVs sold last year. 

More shifts in tax incentives for EVs at the beginning of 2024 have created some ups and downs for consumers, on the down side, they now have fewer vehicles to choose from, down from 50 to 13. The good news for both dealers and consumers, is the ability for dealers to apply EV tax credits at the point of sale. The Tesla Model Y, ChevyBolt and Rivian R1T pickup trucks still qualify. 

The Cox Automotive Economic Insights team is forecasting EV share of the U.S. market in 2024 will reach 10%, and is calling 2024 "The Year of More" when it comes to EVs.  More new products, more incentives, more inventory, more leasing, more infrastructure.

2023 EV SHARE OF TOTAL BRAND SALES