Electric vehicle (EV) registrations in the U.S. in 2020 reached 1.8 percent market share, their highest level yet, demonstrating increased consumer interest, a new analysis from IHS Markit notes. December 2020 also represented the highest monthly share for new EV registrations at 2.5 percent of the industry, which IHS says is a record monthly level. For the purposes of this analysis, EVs reflect those vehicles only powered by electricity and no other power source, the company says.
While overall registration volumes were down across the industry for the year because of COVID-19, IHS says the fact that EVs experienced increased market share indicates rising consumer acceptance. From a retail perspective, EVs accounted for 2.8 percent of new vehicle registrations in December, according to the analysis, more than tripling the EV retail share from three years ago. This rising EV acceptance coincides with recent automaker announcements of substantial investments in electrification, IHS adds.
IHS Markit forecasts EV sales in 2021 will surpass 3.5 percent nationally and will continue to increase to more than 10 percent in 2025. Across the automotive spectrum, a wave of new EV products and brands all support EV trends in 2021 and beyond, the company says. With more than 100 new EV options expected between 2021 and 2025, a continued increase in consumer acceptance and demand will grow as internal combustion engine options are displaced by EVs.
Tom Libby, IHS Markit associate director of Industry Analysis, who is based in Southfield, Michigan, has been following fuel type market share for several years. “Consumer acceptance of electric vehicles is increasing, though at a modest pace, and now is at record levels,” he says. “We continue to see significant contrasts in EV adoption across different regions of the country, led by the two coasts.”
From a regional perspective, EV market share is highest in the western region, where 4.8 percent of all new vehicles registered are electric. The San Francisco designated market area (DMA) EV share of 11 percent far exceeds that of any other major DMA in the western region, according to IHS. EV market share is 1.6 percent in the Northeast, the second-highest region on this metric, with New York City DMA driving that region with 2 percent market share. In the Southeast, only 1.1 percent of 2020 new vehicle registrations were for EVs, led by Washington, D.C., DMA at 2.5 percent. The Southwest region EV share was just 0.9 percent in 2020, while Austin, Texas, was the top DMA in that region with 2.1 percent EV market share. Lastly, the Midwest region had the smallest EV market share in 2020 at just 0.8 percent, led by Chicago with a 1.5 percent EV market share.
IHS Markit says more than half of EV households that return to market acquire another EV, up substantially from prior years.
“Record-high EV loyalty rates imply consumer acceptance for the entire electric vehicle concept,” Libby adds.