Are USA EV sales in decline?

[David Green]

Now that we are getting a better picture of USA EV sales for August it is becoming clear that 8 months into the year the EV sales in the USA are plateauing, and in Q3 sales are falling over the comparable months from 2018. Hmm, this is surprising to me with so many new options on the market.

I wonder if we are beginning to see resistance on USA EV sales, or is this a calm before the storm?

 

[davidtm]

In my particular circumstance, I am waiting for a certain model (Kia Soul EV) to become available in the USA. Plus, I will have to buy in a neighboring state. I suspect this could be true for any number of potential EV buyers waiting on a bottleneck of some kind.

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[bwilson4web]

Source: https://www.coxautoinc.com/news/cox-automotive-forecast-u-s-auto-sales-august-2019/

ATLANTA, Aug. 28, 2019 – Cox Automotive is forecasting U.S. new-vehicle sales volume in August to finish at 1.59 million, up 6.5% from last year, or an increase of nearly 100,000 units. The seasonally adjusted annual rate (SAAR), however, is expected to drop to 16.5 million, below July’s 16.8 million level, and down from August 2018’s strong pace of 16.9 million.

Charlie Chesbrough, senior economist with Cox Automotive, suggests a trend may be emerging: “Unfortunately, the third time is not a charm here. Compared to May 2019, which had the highest SAAR this year, August is forecast to be the third month in a row with a slowing sales pace. The market may finally be succumbing to toughening buying conditions and satiated vehicle demand.”
. . .​

Bob Wilson

 

[David Green]

Source: https://www.coxautoinc.com/news/cox-automotive-forecast-u-s-auto-sales-august-2019/

ATLANTA, Aug. 28, 2019 – Cox Automotive is forecasting U.S. new-vehicle sales volume in August to finish at 1.59 million, up 6.5% from last year, or an increase of nearly 100,000 units. The seasonally adjusted annual rate (SAAR), however, is expected to drop to 16.5 million, below July’s 16.8 million level, and down from August 2018’s strong pace of 16.9 million.

Charlie Chesbrough, senior economist with Cox Automotive, suggests a trend may be emerging: “Unfortunately, the third time is not a charm here. Compared to May 2019, which had the highest SAAR this year, August is forecast to be the third month in a row with a slowing sales pace. The market may finally be succumbing to toughening buying conditions and satiated vehicle demand.”
. . .​

Bob Wilson

Bob, I do not see the point of your article, they state the August sales are up 6.5%, but we can see EV, and Especially Tesla sales are way down from last August. Hmmm, what gives? GM truck sales are booming in AUG 2019, and at over $70K for the HD diesels now, I bet they are making pretty hefty profits..

 

[interestedinEV]

A certain stabilization in demand before growth resumes is normal. That could be possibly be one reason. But it is never black and white, there are several other possible reasons. Second is that the Federal Incentives have gone for GM and Tesla. It has not gone for others, but there is a perception that they (other cars) are overpriced, even with the incentive when there features are compared with the Tesla. I know that the e-tron is close to @David Green but many people look at the range (204 miles vs 370 miles for the S) and decide that it may not be for them. Range may be more important in US than Europe. (I would prefer not get into a discussion if the e-tron is better, I have more than one person tell me they rejected as they did not see paying that much money for a lower range than the S.) Hence the current competition does not really make a big impact on the market. that there is a segment of potential buyers who may not want the current Teslas' but do not see an good alternative. I believe the current competition is lackluster, you are welcome to disagree. People may be waiting for a better opportunity to get the federal discount, which leads us to the third reason.

Third, there are people including me , who are in a wait and see mode, hoping that competition comes up with other alternatives. One is Rivian, there is a lot of anticipation there. Ford may come up with a Pickup, so will Tesla. Then we have Model Y and possibly the Crozz. We have the new GM which has still to be announced. Some like @davidtm are waiting for cars already available but only in California like the Hyundai/Kia. Again most of these new crop of cars are a year away at the best, but I think the fresh crop of cars will inspire more confidence then the current of crop of "Tesla Killers".

Fourth, there is clearly a focus from the current administration in the US to de-emphasize BEVs in favor of ICEs. This reduces the pressure on other manufacturers to expand the BEV market. Now the attitude is that "we will make EVs if we see a demand" rather than "we need a way to meet the mandates and hence need to create demand". (California is an exception) Again, no political discussion on if it is good or bad, just the facts Ma'am/Sir.

So while I do not know that there is only one reason why sales have flattened, I so believe it will grow but there will be fits and starts. I understand you may discount all my reasons and so be it.

 

[David Green]

A certain stabilization in demand before growth resumes is normal. That could be possibly be one reason. But it is never black and white, there are several other possible reasons. Second is that the Federal Incentives have gone for GM and Tesla. It has not gone for others, but there is a perception that they (other cars) are overpriced, even with the incentive when there features are compared with the Tesla. I know that the e-tron is close to @David Green but many people look at the range (204 miles vs 370 miles for the S) and decide that it may not be for them. Range may be more important in US than Europe. (I would prefer not get into a discussion if the e-tron is better, I have more than one person tell me they rejected as they did not see paying that much money for a lower range than the S.) Hence the current competition does not really make a big impact on the market. that there is a segment of potential buyers who may not want the current Teslas' but do not see an good alternative. I believe the current competition is lackluster, you are welcome to disagree. People may be waiting for a better opportunity to get the federal discount, which leads us to the third reason.

Third, there are people including me , who are in a wait and see mode, hoping that competition comes up with other alternatives. One is Rivian, there is a lot of anticipation there. Ford may come up with a Pickup, so will Tesla. Then we have Model Y and possibly the Crozz. We have the new GM which has still to be announced. Some like @davidtm are waiting for cars already available but only in California like the Hyundai/Kia. Again most of these new crop of cars are a year away at the best, but I think the fresh crop of cars will inspire more confidence then the current of crop of "Tesla Killers".

Fourth, there is clearly a focus from the current administration in the US to de-emphasize BEVs in favor of ICEs. This reduces the pressure on other manufacturers to expand the BEV market. Now the attitude is that "we will make EVs if we see a demand" rather than "we need a way to meet the mandates and hence need to create demand". (California is an exception) Again, no political discussion on if it is good or bad, just the facts Ma'am/Sir.

So while I do not know that there is only one reason why sales have flattened, I so believe it will grow but there will be fits and starts. I understand you may discount all my reasons and so be it.

Agree with most of what you are saying for the USA market. Although E-Tron works for us, the range is too short for some, and there is a disconnect in many peoples understanding of CCS charging, as Tesla's fans have worked overtime to brag up the supercharger network (already surpassed by EA where I live)

I think there is room in the market for all the competitors, people buying I-Pace seem to love it as do most E-Tron buyers. The term Tesla killer is silly, I think Tesla killer number 1 is Elon Musk and his poor management style. He was great when Tesla was a start up, but now Tesla is a larger company and Elon does not have the bandwidth to manage such a large enterprise, and make good decisions to strengthen their future. I think Q3 is going to prove to be a big setback for Tesla as their average transaction price continues to plummet, and revenue keeps dropping. Looking at the ratio of Model 3 SR+ sales to LR, the ratio has flip flopped to a strong majority of sales are the SR+, thats going to hit the bottom line hard. Also with the huge price reductions on S ,X, and 3, and collapsing sales, I see stormy weather ahead.. As for Audi, if E-Tron does not sell well, no biggie as it is not the profit center of the company anyway. I expect Tesla to crank up some incentives soon, or more price reductions? Lets wait and see... I bet we see action in the next week.

BTW, Audi reported August sales higher than last year by 3% in the USA. Tesla for August is down over 30% YOY Model 3 down 26% X down 30% and S down a whopping 70% over August 2018... WOW.... and then remember the average sale price last year of S and X was 100K and 3 was 60K Ouch... Tesla needs to kill it in September or we may see out first $2B quarterly loss

Tesla August 2018 total USA sales 23175
Tesla August 2019 total USA sales 16350 OUCH!!!

 

[bwilson4web]

I'm fairly calm about recent sales but suspect the chilly winds of recession are tightening up wallets and purse strings. I thought I'd seen a Wards summary saying the same but could not Google it up. Regardless, the Cox report, predating the first week of September was the only one. I'm open to seeing what comes out in Autoline After Hours on Thursday.

We've seen past auto sales stalls that often were symptoms of an economic downturn. So maybe the tariffs are working but the question is, 'For whom?'

Bob Wilson

 

[David Green]

I'm fairly calm about recent sales but suspect the chilly winds of recession are tightening up wallets and purse strings. I thought I'd seen a Wards summary saying the same but could not Google it up. Regardless, the Cox report, predating the first week of September was the only one. I'm open to seeing what comes out in Autoline After Hours on Thursday.

We've seen past auto sales stalls that often were symptoms of an economic downturn. So maybe the tariffs are working but the question is, 'For whom?'

Bob Wilson

Bob, Audi August sales were up 3% , Toyota up 12%, GM Truck sales up (Flint plant working 7 days a week mandatory overtime) Tesla was down 30% that is crazy decline, and September is not off to a hot start, and is usually not a great month with all the back to school rush.

 

[bwilson4web]

Bob, Audi August sales were up 3% , Toyota up 12%, GM Truck sales up (Flint plant working 7 days a week mandatory overtime) Tesla was down 30% that is crazy decline, and September is not off to a hot start, and is usually not a great month with all the back to school rush.

Lordstown?

Source: https://www.cnn.com/2019/03/04/business/general-motors-lordstown/index.html

A plant in Baltimore is set to close next month. Another in Warren, Michigan, is due to shut in August. Those two transmission plants have about 500 employees between them, and 50 workers have accepted transfers. The Hamtramck plant, the last factory GM operates in Detroit, was originally due to close later this year but will now stay open until January 2020. It has 1,350 hourly workers, about 600 of whom have accepted transfers.

In total, more than 1,000 of the 3,300 US hourly workers whose plants are being closed have accepted transfers to other plants.​

Bob Wilson

 

[David Green]

Lordstown?

Source: https://www.cnn.com/2019/03/04/business/general-motors-lordstown/index.html

A plant in Baltimore is set to close next month. Another in Warren, Michigan, is due to shut in August. Those two transmission plants have about 500 employees between them, and 50 workers have accepted transfers. The Hamtramck plant, the last factory GM operates in Detroit, was originally due to close later this year but will now stay open until January 2020. It has 1,350 hourly workers, about 600 of whom have accepted transfers.

In total, more than 1,000 of the 3,300 US hourly workers whose plants are being closed have accepted transfers to other plants.​

Bob Wilson

GM is smart, close down those old plants with undesirable and unprofitable products and invest heavily in profitable products like trucks and SUV's... Business is about making profit... So they can pay dividends...

GM was preparing for recession, right sizing the company... Not making their old past mistakes.

 

[David Green]

Source: https://www.coxautoinc.com/news/cox-automotive-forecast-u-s-auto-sales-august-2019/

ATLANTA, Aug. 28, 2019 – Cox Automotive is forecasting U.S. new-vehicle sales volume in August to finish at 1.59 million, up 6.5% from last year, or an increase of nearly 100,000 units. The seasonally adjusted annual rate (SAAR), however, is expected to drop to 16.5 million, below July’s 16.8 million level, and down from August 2018’s strong pace of 16.9 million.

Charlie Chesbrough, senior economist with Cox Automotive, suggests a trend may be emerging: “Unfortunately, the third time is not a charm here. Compared to May 2019, which had the highest SAAR this year, August is forecast to be the third month in a row with a slowing sales pace. The market may finally be succumbing to toughening buying conditions and satiated vehicle demand.”
. . .​

Bob Wilson

September EV sales are off to quite a slow start. The Shorts who track Tesla closely are reporting in the hottest USA markets Tesla sales are about 50% below June 2019 weekly levels meaning we could be setting up for not only a YOY sale loss in the USA, but for Tesla globally. I may need to revise my 3Q 2019 estimates lower for Tesla, I am now at 80K total global sales, but I might be high... USA sales will be dramatically lower than 2018 for S, X and 3.

Why are the EV sales in the USA plateauing for the year and falling off a cliff in recent months? Has the market demand for EV's been saturated already? This goes strongly against the sales growth we have seen in past years.

 

[davidtm]

Some of us are waiting for EVs other than Tesla. In our case, the lack of supply is throttling demand.

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[bwilson4web]

Some of us are waiting for EVs other than Tesla. In our case, the lack of supply is throttling demand.

Could you list mandatory and optional requirements?

• mandatory - these are pass/fail requirement(s)
• optional - those that can be assigned a weighting/cost factor

Understand requirements are a personal thing which is why I ask. The reason I ask is "other than Tesla" is not a technical requirement.

Bob Wilson

 

[davidtm]

Well, there's inadequate data for some of this decision as yet. But my wants are . . .

1. Hatchback style
2. Somewhat elevated seating/viewing position a la crossover style (ease of entry/exit, visibility)
3. Price (here's where the Federal tax refund comes in to play)
4. Reliability

I am awaiting the release of the new Soul EV to the US, as I believe it fulfills all of these (reliability TBD)

My somewhat irrational reason for not a Tesla is the feeling of joining a "cult". The more rational reasons are cost, the sedan/low seating design, and maintenance/service issues (closest center is 75 miles away).

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[bwilson4web]

1. Hatchback style
2. Somewhat elevated seating/viewing position a la crossover style (ease of entry/exit, visibility)
3. Price (here's where the Federal tax refund comes in to play)
4. Reliability

Thanks! We agree on:

• Hatchback - would make camping out in the Model 3 easier.
• elevated seating - the seats are about 1-2" too low as I noticed when wearing work boots.

In my case, special pleadings:

• Price - got $18.3k trade-in for Prius Prime. Already booked the Prius Prime tax credit, $4.5k, and getting a $3.75k Model 3 tax credit. Hummm, total tax credits $8.25k.
• Reliability - never trust anyone, always have a backup.

Bob Wilson

 

[davidtm]

In Virginia, I'll only get the Fed refund which is down to $1875 as of July 1. Compared to Kia's $7500 still.

I also didn't mention a couple of other factors.

Tesla clearly wins the charging infrastructure issue. But I'm encouraged by the new efforts through EA (despite their rip off pricing based on theoretical charging speed rather than actual) and hopefully others. I've come to realize that nearly all of my driving will be local, so charging at home will be the norm. I may have to let go of my fantasy of constantly taking road trips like Bjorn. [emoji16]

As far as driver assistance tech, other makes are doing well with automated cruise. The LKA and LFA functions appear to be pretty good on Hyundai/Kia.

The fickle packaging and pricing behavior of Tesla will always make me wonder if I got ripped off if I got a Tesla. AP is particularly problematic here.

Final nit: I can't wait to try/use the automatic regen found in Kia/Hyundai. I found Tesla's too harsh, and you only have 2 choices.

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[bwilson4web]

The fickle packaging and pricing behavior of Tesla will always make me wonder if I got ripped off if I got a Tesla. AP is particularly problematic here.

A Macintosh owner, Apple desensitized me to price and model changes. As for AP, I use it as much as possible, even outside the 'documented' range.

With practice, you learn what AutoPilot can and can not do. This pays dividends in new places where the situation can change rapidly ... and keeps you on your toes. It makes driving interesting and fun again.

Bob Wilson

 

[David Green]

In Virginia, I'll only get the Fed refund which is down to $1875 as of July 1. Compared to Kia's $7500 still.

I also didn't mention a couple of other factors.

Tesla clearly wins the charging infrastructure issue. But I'm encouraged by the new efforts through EA (despite their rip off pricing based on theoretical charging speed rather than actual) and hopefully others. I've come to realize that nearly all of my driving will be local, so charging at home will be the norm. I may have to let go of my fantasy of constantly taking road trips like Bjorn. [emoji16]

As far as driver assistance tech, other makes are doing well with automated cruise. The LKA and LFA functions appear to be pretty good on Hyundai/Kia.

The fickle packaging and pricing behavior of Tesla will always make me wonder if I got ripped off if I got a Tesla. AP is particularly problematic here.

Final nit: I can't wait to try/use the automatic regen found in Kia/Hyundai. I found Tesla's too harsh, and you only have 2 choices.

Sent from my Pixel 3a using Tapatalk

Tesla is constantly jumping around on model packages, and pricing... The company is operated in such an unstable way. I used to like the region setup best in the 2018 Leaf, with the E-Pedal, but now, I think I like the automated system in the E-Tron better (smoother and more refined).