Electric vehicle sales growth slows as more car buyers turn to hybrids and many drivers in red states shun the technology altogether

Electric vehicle sales growth is starting to slow in the U.S., a trend that is worrying automakers who are betting big on the emerging technology.

Although electric vehicle sales are approaching an annual record of more than 1 million units in 2023, year-over-year growth is starting to slow.

Last month, electric vehicle sales rose 42 percent from a year ago, but that growth rate marked a decline from annual sales growth of 76 percent in April 2022, according to data reported by the Wall Street Journal.

But so far in 2023, Americans have purchased a record number of more than 1 million hybrids — a 76 percent increase over the same period last year, according to Edmunds.com. Last year, hybrid purchases were still below the 2021 level.

True EVs still account for only about 7 percent of all U.S. auto sales, and their popularity varies widely from state to state, with coastal states easily surpassing the Midwest and Plains for EV market shares.

The popularity of EVs varies widely from state to state, with coastal states far outpacing EV market share in the Midwest and Plains

Electric vehicles tend to be more popular in urban areas with denser charging infrastructure, and are more affordable in states that offer generous tax breaks and credits.

Weather can also play a role: In colder climates, the range of EV batteries tends to decrease noticeably, a drawback that smart car buyers take into account.

Of all states, North Dakota (a bitterly cold, mostly rural state) has the smallest EV market share at just 1.2 percent, according to data from the Alliance for Automotive Innovation.

California, with its warm weather, big cities and generous tax breaks, leads the nation with a 25 percent market share of electric vehicles, followed by DC, Washington state, Oregon and Nevada.

The national slowdown in EV sales growth has raised concerns among automakers that buyer interest in EVs is waning.

Some companies are cutting production and scaling back plans for new battery or assembly plants.

In October, Ford said it would defer about $12 billion in EV investments, including delaying its second battery factory in Kentucky. The company also temporarily halted production of its electric Mustang Mach-E.

Now Ford and other automakers are starting to place more emphasis on hybrids, which burn gasoline but use an electric motor to supplement the combustion engine.

Ford, the nation's second-largest hybrid seller after Toyota, expects to produce enough hybrids to quadruple sales within five years.

Although electric vehicle sales are approaching an annual record of over 1 million in 2023, their year-on-year growth is starting to slow

Ford has temporarily halted production of its electric Mustang Mach-E (above) and is postponing approximately $12 billion in EV investments, including delaying its second battery factory in Kentucky

General Motors, which four years ago abandoned most hybrids in the U.S. in favor of electric vehicles, now says it is considering bringing them back.

The reasons why hybrids have quickly become the preferred choice for many buyers vary.

They range from the higher prices of comparable EVs to concerns about the scarcity of charging stations to the recognition that hybrids offer many of the same benefits without the hassle of EVs.

In the meantime, surveys show that consumers are still concerned about the availability of charging stations or the retail prices of electric vehicles – in many cases even taking into account tax credits made available by the federal government for the purchase of electric vehicles.

“Your standard hybrid makes the most sense for most people,” says Ivan Drury, director of the automotive website Edmunds.com.

“I think you'll find that people don't want the hassle or hassle of charging.”

Hybrids emit some exhaust pollution. But because they use less fuel than cars equipped exclusively with petrol engines, their emissions are lower.

In addition, purchase prices for hybrids are comparable to gasoline vehicles and typically much lower than for comparable electric vehicles.

“People are fine with a car that gets 45 or 50 miles per gallon, and you don't have to do anything,” other than the current behavior, said Scott Adams, owner of a Toyota dealership in suburban Kansas City.

“People are fine with a car that gets 45 or 50 miles per gallon, and you don't have to do anything” other than the current behavior, said Toyota dealer owner Scott Adams

Electric car prices have fallen, mainly due to federal tax breaks and price cuts by Tesla, the market leader. However, they are still more expensive than hybrids or gasoline vehicles

After peaking at nearly $63,000 last year, the average EV sales price fell to just over $60,500 in November, not including tax credits or pricing from Tesla, which does not release them.

However, fewer electric cars are likely to qualify for the tax breaks by 2024 because of rules that prevent buyers from claiming a full credit if they buy cars with battery materials from China or other countries considered hostile to the United States.

The average price of a hybrid has stabilized at about $42,000. A typical hybrid costs a little more than its gasoline counterpart.

For example, a Toyota RAV4 hybrid with all-wheel drive costs $32,825, $1,600 more than a comparable gasoline version.