Will buyers still seek out electric vehicles (EVs)?
That was a big question heading into the COVID-19-sparked economic downturn.
A few months in, the answer is an unqualified yes.
Tesla parlayed rising sales into its fourth consecutive profitable quarter as Model 3 cars and Model Y crossovers became more widely available worldwide. General Motors (GM), which is in the process of launching several new EVs throughout the next year, posted a sales gain on its Chevy Bolt EV car.
In some ways, EV makers have been lucky. The spikes in unemployment and economic strife hitting the economy have been more pronounced at the lower end of the economic spectrum – blue collar workers with frontline jobs in factories or retail establishments shuttered by the fast-spreading virus.
Those demographics favor Tesla shoppers who are more affluent and have jobs that can be performed remotely. Countering the rich-person, second-car stereotype, the EV sales increase came as vehicles got dramatically more affordable. Most Model 3s still cost more than $50,000 when fully equipped, but versions that sell for less than $40,000 are available. That’s still pricey compared to a $25,000 sedan, but it’s within the budgets of some young buyers who want technologically advanced cars.
That ability to stay profitable and expand market share during the worst economic conditions in generations shows the promise of the EV market. If it can do this well now, imagine how strong the market could be when people start driving more than 10 miles a week.