EV demand leads automakers to a strong 2024 finish

Automakers closed 2024 with strong sales in the United States in the final three months of the year, helped by a surge in demand for electric models.

The gains were led by General Motors, which said Friday that its fourth-quarter sales rose 21% from a year earlier, to more than 755,000 cars and light trucks. Its electric vehicle sales in the quarter more than doubled, to nearly 44,000, making GM the second-largest EV seller after Tesla.

Ford Motor sold more than 530,000 vehicles in the quarter, a gain of nearly 9%. Ford’s EV sales climbed 16%, to more than 30,000 vehicles.

Honda Motor reported a gain of 9% in the fourth quarter, while Hyundai and Nissan each said their sales climbed 10%.

Not every company came out ahead. Toyota posted a 3% decline in quarterly sales, while Stellantis, the maker of Jeep, Chrysler and Ram vehicles, reported its sales fell 7%.

Cox Automotive, a market researcher, said it expected auto sales to grow 2.8% this year, to 16.3 million cars and trucks. Jonathan Smoke, Cox’s chief economist, said consumer sentiment, wages and other economic factors were adding to demand.

“Wages are growing. Vehicle incentives have risen. Loan approve rates are up,” he said. “As we enter 2025, momentum is back on our side.”

For much of 2024, sales of electric models grew modestly as consumers fretted about their prices — EVs are somewhat more expensive than comparable gas-powered vehicles — and the challenges of charging while on the go.

But in the fourth quarter, sales of EVs jumped about 12%, Cox said, to 356,000 vehicles, helped by lower interest rates and sweetened incentives and discount plans. Tesla, for example, is offering a three-year lease on its Model Y hatchback for as little as $199 per month. Kia is promoting two-year leases on its EV6 for as little as $159 per month. Ford is providing free home charging stations and installation to customers who buy or lease one of its electric models.

Analysts said the year-end jump in EV sales might also have been spurred somewhat by President-elect Donald Trump, who has suggested he will eliminate the $7,500 federal tax credit on electric vehicles priced under $80,000. The tax credit has helped manufacturers offer the attractive lease deals.

“The incentives on EVs have been really good, but there may also have been some awareness among consumers that the tax credit could go away, and that may have helped bring people into the market,” said Jessica Caldwell, head of insights at Edmunds, another auto industry researcher. “If we do get to the point where it definitely is going away, there could be a stronger rush to buy.”

For the full year, the industry sold just shy of 16 million cars and trucks, according to Cox, an increase of about 2% from 2023. GM was the largest producer, having sold 2.7 million vehicles, followed by Toyota with sales of 2.3 million cars and trucks, and Ford with 2.1 million.

Tesla does not break out its sales by region, but Cox estimated that the automaker’s U.S. sales fell 6% in 2024. On Thursday, Tesla, the EV leader, announced a slight drop in worldwide sales in 2024, its first annual decline, in the face of increased competition, though its fourth-quarter sales set a company record.

Cox said automakers sold 1.3 million EVs domestically in 2024 — 8% of all new vehicle purchases — up from 1.2 million in 2023. Tesla was the top seller, accounting for just under half of all EV sales.

This article originally appeared in The New York Times.

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