According to a report from the US Energy Information Administration (EIA), the share of electric and hybrid vehicle sales in the United States increased again in the third quarter of 2024, reaching a record high. 

Estimates from Wards Intelligence suggest that the combined sales of hybrid vehicles, plug-in hybrid electric vehicles, and battery electric vehicles (BEVs) rose from 19.1% of total light-duty vehicle sales in the United States in the second quarter to 19.6% in the third quarter. 

This increase in the market share of electric and hybrid vehicles was primarily driven by hybrid electric vehicle sales. 

The share of hybrid vehicle sales increased, with hybrids representing 10.8% of the U.S. light-duty vehicle market in the third quarter of 2024, a new record. 

On the other hand, sales of battery electric vehicles (BEVs) declined, with their share dropping from 7.4% of the U.S. light-duty vehicle market in the second quarter of 2024 to 7.0% in the third quarter of 2024. 

BEVs continued to be popular in the luxury vehicle segment, accounting for 35.8% of luxury LDV sales in the U.S. in the third quarter. However, luxury BEVs as a proportion of total BEV sales have been decreasing as sales outside the luxury market have increased, falling to the lowest share since the second quarter of 2017. 

Still, 70.7% of BEVs sold in the U.S. during the third quarter were luxury vehicles, while 10.3% of hybrid vehicles sold were luxury models. 

According to Cox Automotive, the average transaction price for a new BEV, before any consumer or government incentives, was $56,351 at the end of the third quarter, approximately 16% higher than the overall industry average. 

Tesla leads the US electric vehicle market, but with a slight decline 

Tesla remains in the top spot in the US electric vehicle (BEV) market, although with 48.8%, its market share was below 50% for the second consecutive quarter this year. 

The Tesla Model Y and Model 3 continue to drive sales, and the newly launched Tesla Cybertruck played a key role in the increase in Tesla's sales in the third quarter of 2024, outselling all its large truck competitors (Rivian R1S, Rivian R1T, Ford F150 Lightning, Chevy Silverado EV, Hummer EV, and GMC Sierra EV). 

Ford maintained the second-largest share of the electric vehicle market, although that share decreased to 6.9% in the third quarter of 2024 from 7.94% in the second quarter of 2024. Sales shifted to other manufacturers such as Chevrolet, driven by sales of the newly launched Equinox model and the continued success of the Blazer. 

Chevrolet replaced Hyundai as the manufacturer with the third-largest share of the electric vehicle market in the third quarter of 2024, with 5.8% of sales. 

Electric vehicle manufacturers are producing vehicles both domestically and globally. According to estimates from Wards Intelligence, 78.9% of all battery electric vehicles sold in the United States in the third quarter of 2024 were produced in North America, 7.3% in South Korea, and 5.3% in Germany. 

Requirements for accessing electric vehicle tax credits 

To qualify for clean vehicle tax credits under the Inflation Reduction Act, manufacturers must meet the domestic content requirements for final assembly, battery components, and critical minerals, which go beyond just manufacturing in North America. 

As a result, not all vehicles classified as manufactured in North America will qualify for this credit. While these requirements apply to purchases of electric vehicles, they are less strict for leases of electric vehicles. 

Many electric vehicle purchases that do not qualify for clean vehicle tax incentives will qualify for the tax credit when leased under the commercial clean vehicle credit, offering consumers a wider range of eligible electric vehicle models.