China drives EV boom this year amid strong demand for hybrid vehicles

EV Sales Surge in Q1 2024, Led by Strong Demand for Hybrids #

Sales of electric vehicles (EVs), including both fully battery-powered vehicles and hybrids, increased by 18% in the first three months of 2024 compared to the same period last year. The growth was primarily driven by a significant increase in sales of hybrid vehicles, which saw a 46% year-on-year jump. This surge in EV sales is attributed to the strong demand for hybrid vehicles, particularly due to their cheaper upfront costs compared to fully battery-powered vehicles and the elimination of range anxiety with the availability of a fuel tank. China remains the leading market for EV sales, with a 28% increase in the first quarter of 2024. The United States and Europe followed as the second and third largest markets, respectively. However, while overall EV sales in the U.S. increased by 2%, sales of fully battery-powered vehicles declined by 3% in the quarter. Tesla, the leading U.S. EV maker, experienced a 9% decline in sales in the first quarter, but still maintained its top position globally in fully battery-powered vehicle sales. BYD, Volkswagen, and Tesla were the top three fully battery-powered vehicle makers, with BYD being the only one to record growth. The report also highlighted the growing global demand for EVs, including hybrids, with the market poised for significant growth. However, concerns about weak resale values and the potential obsolescence of current EV technology have led to a decline in interest in fully battery-powered vehicles among consumers. Additionally, new tariffs on EV imports from China by the EU and the U.S. may pose additional challenges to the market.