Is The EV Fever Over? Concerns Raised As Sale Of Electric Cars Takes A Back Seat

Elon Musk's Tesla's fortunes have been on steady decline for some quarters now, and what came to pass last week, when the company's sales and shares tanked, underscores that apparent decline. But, outside of the 'Musk universe', where all eyes are on Tesla, there is visible and tangible trend of a slim decline in the progression of the EV business in major market.

BYD-Tesla See a Drop in Their Numbers

Tesla's biggest rival, BYD also saw its sales slump significantly by 43 per cent in the first three months of 2024, compared to to the last three months of 2023. This however aided Tesla, which climbed back to being the market leader in EV sales, despite its own tepid numbers.

The salient question to be asked, is whether the EV fever has subsided, if not gone. This as major names in the car market, particularly the American giants, namely Ford and GM after burning their hands in the EV business, we ostensibly forced to scale back on their EV ambitions. In addition to this, the behavior of major markets like India and US, leave a lot of room to ruminate.

In India, although the growth of EVs has increased, the sale of hybrid cars is far higher. The sale of HEVs, saw a 17 per cent jump, compared, in just a year, constituting about 2 per cent of all passengers vehicles sold in India.

Cheaper Cars Rock the Market

When we come to the US, in the same period, when Tesla saw its sales drop, purchase of cheaper vehicles were much higher. These developments are happening at a time, when the US economic paradigm is much more stable than what was anticipated earlier. This has also paved way for better consumer confidence in the market.

Therefore, despite conducive factors, an EV's appeal does not appear as crucial to the common customers, as once assumed. There is also another factor, that some seem to be pointing at. It is the problem of lack of charging infrastructure, which in turn impacts.

In addition impending windfall of issues, albeit the conflicts throughout the globe and the potential disruption to supply chain could only add to the woes. The recent earth quake in Taiwan and disruption of the semiconductor manufacturing business may also have a ripple effect on these cars that run on advanced chips. In all the general interest towards EV may have taken a back seat, contributing the adjacent factors, mentioned above.

The upcoming quarters and the results that are achieved in the period, will determine the road ahead for the EV mania.