New players are yet to reach profitability
Tesla continues to dominate the U.S. EV market, with an estimated 536,100 electric vehicles sold in the United States in 2022. However, competition is beginning to gain momentum, and manufacturers such as General Motors are continuing to add new EV models into their range of vehicles offered. Ford's Mustang Mach-E and Chevrolet's Bolt made it into the list of best-selling battery-electric vehicle models in 2022. Nearly 20,800 and 22,100 Chevrolet Bolts were sold in the United States in 2020 and 2021, respectively. The model is manufactured by a subsidiary of General Motors, which will end its Bolt production at the end of 2023 to focus on building electric pickup trucks. 2022 Chevrolet Bolt sales dropped to their lowest point since 2017. General Motors intends to only sell zero-emission vehicles by 2035.Despite more American brands ranking high among the best-selling battery-electric vehicle (BEV) brands in the United States, the U.S. electric vehicle market heavily depends on Tesla's sales. In 2022, the company reported over five times as many BEV sales as Ford, which ranked second. This contrasts with the global BEV market, where the gap between Tesla and other manufacturers is not as steep.
Tesla's success and the increasing popularity of electric vehicles have attracted growing investments in EVs, charging infrastructure, and battery manufacturing. Manufacturers are looking to increase their research and development expenditure, with electric mobility at the forefront of their investments. This is partly motivated by the U.S. government's commitment to decarbonizing its fleet, with many states pledging to ban the sale of fossil fuel vehicles by 2035. However, despite this success, new market players still struggle to attain profitability. Despite the R1T being among the ten best-selling battery-electric cars in the U.S., Rivian reported its largest net loss in the 2022 fiscal year. Lucid Motors fared better, decreasing its net loss that same year, but has yet to become profitable.
Market challenges discourage consumers
Increasing retail gasoline prices could contribute to consumer interest in EVs. However, the market still faces various challenges which can act as disincentives for prospective car buyers. In an October 2022 survey, U.S. respondents highlighted EVs' cost, driving range, and the time necessary to charge their batteries as the leading concerns regarding battery-electric vehicles. According to an October 2022 survey, 47 percent of U.S. participants expected an EV to have a driving range of 400 miles or above, including 19 percent expecting an EV to have a driving range of 600 miles or more. As of April 2023, the 2022 Lucid Air Dream Edition Range was the EV model with the longest range on the market at 520 miles. Tesla's 2021 Model 3 with all-wheel drive, second in this ranking, had a driving range of around 353 miles, fitting or exceeding the expectations of 53 percent of U.S. consumers.However, while consumers' range anxiety might not match market reality, price inflation has been heavily impacting the automotive market due in part to market uncertainties linked with the semiconductor shortage and rising raw material prices. While electric vehicles were not as affected by this uncertainty, their price point was still prohibitive for many consumers. In December 2022, the average selling price for electric cars was the third highest across all vehicle types. It remained relatively stable compared to December 2021—down 397 U.S. dollars to nearly 61,500 U.S. dollars.
When it comes to electric vehicle charging infrastructure, the United States boasts the third-largest public charger network worldwide. However, 77 percent of U.S. consumers surveyed in October 2022 reported intending to charge their electric vehicles most often at home, highlighting prohibitive installation costs as one of the main reasons they could not access charging at home. In 2022, the U.S. recorded over 136,500 public chargers installed in the country, over six times the size of its private charger network. These various challenges leaves space for new opportunities in the U.S. EV market, with the government supporting EV adoption by enacting various laws and incentives to promote the sector—608 electric vehicle laws and incentives were recorded in 2022.