Increased EV registrations with high incentives impacting profitability for some automakers

From Nasdaq: 2024-07-20 11:16:00

Despite challenges in the EV industry, new U.S. EV registrations rose nearly 10% in May, totaling 105,000 vehicles, making up 7.5% of the U.S. light vehicle market. However, incentives and promotions are high, with Tesla’s registrations falling 15%. Kia saw a 146% increase due to offers of up to $18,000.

While EV registrations are up, many automakers are offering significant incentives to drive sales, impacting profitability. Tesla’s share of the market dropped to 46%, while Kia saw a 146% increase in registrations due to incentives. Investors should consider what drives sales figures, whether it be demand or incentive deals.

Rivian has been able to achieve an 87% gain in registrations with minimal incentives compared to other automakers. The industry is facing a dilemma of offering incentives to drive sales or focusing on profitability. This data points to the challenges automakers face in balancing sales volumes and profits.



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