Will 2016 be Turning Point for EV and PHEV Sales?

The news receiving the most publicity this year has been Tesla’s announcement of its new model 3, and the 325,000 preorders for the car.

This has overshadowed actual sales results for EVs and PHEVs for the first quarter of 2016.

US Sales of Electric Vehicles, Including HEVs 2016

Month Hybrid (HEVs) PHEVs & Extended Range Vehicles Battery (BEVs) Totals Total PHEV & EV


















Total 1Q






Total 1Q 2015






% change






Total 4Q 2015




% QoQ change




BEVs are vehicles powered entirely by battery power. PHEVs use the battery to travel for the first 35 miles, but then switch to an internal combustion engine to extend its range. An important distinction between HEVs, such as the Prius, and BEVs or PHEVs is that an HEV can only travel around 2 miles on battery power while BEVs and PHEVs can travel for at least 35 miles using batteries alone.
(Data from Electric Drive Transportation Association)

Comparisons between the first quarter of 2016 and the first quarter of 2015 are generally favorable, with PHEV sales increasing 37%, and EV sales increasing 7% YoY.

Comparisons with fourth quarter 2015 sales, i.e., Q over Q, are less favorable, with PHEV sales down 11%, and EV sales down 24% QoQ.

Of particular interest is the fact that the sale of Hybrids were down 16% YoY, and down 16% QoQ.

Hybrids were considered avant-garde a few years ago, but they have inherent drawbacks, such as their very small size and difficulty for taller people to enter the vehicle. Low gasoline prices have probably had a significant negative effect on the sale of hybrids.

The Nissan Leaf had sales of fewer than 3,000 vehicles during the fourth quarter of 2015, one-third of 4Q 2014 sales. First quarter 2016 sales are not known, but are probably below 3,000 vehicles.

The failure of the Leaf can be attributed to its short range, i.e., fewer than 100 miles. This is conclusive proof that any EV, to be successful, must have a range comparable to a gasoline vehicle of around 300 miles.

There seems to be an important anomaly between the data shown in the above table, highlighted in green, and the media reports of Tesla’s fourth quarter sales of over 17,000 vehicles. First, it would confirm that Nissan’s Leaf had very few sales.

There are three possible explanations for the anomaly:

  • A significant portion of Tesla’s sales were to foreign countries
  • Tesla’s sales were less than being reported in the media
  • The data for the above table is incorrect

The media has reported that Tesla’s 2015 sales were over 50,000 vehicles, while Musk has forecast sales of 1,600-1,800 per week in 2016. Sales of 1,600 vehicles per week would result in total 2016 year sales for Tesla of 83,000 vehicles.

Referring to the above table, total 1Q EV sales were 15,115 vehicles. If 100% of these were for Tesla vehicles, i.e., no Leaf or BMW sales, etc., it would extrapolate to 60,000 US Tesla vehicle sales for 2016. This is well below the approximately 83,000 forecast by Musk.

At some point, when Tesla sells more than 200,000 vehicles, Tesla vehicles will no longer be eligible for the $7,500 tax credit, and that is likely to affect Tesla’s sales.


Tesla’s stock price has benefitted from the hype surrounding each of Tesla’s announcements, whether it was for the Model X, the Model 3, or Powerwall batteries.

The forthcoming hype surrounding the opening of the Tesla giga battery factory will provide another boost to Tesla’s stock, but after that announcement the company will have to rely on its ability to produce vehicles at a profit.

It’s likely, later this year, that a major investor will begin to short Tesla’s stock, if the company doesn’t meet its promises.

This year, 2016, will be an interesting year for EV sales, with the introduction of the Bolt by GM, and other EV models by other manufacturers.

How these additional models will affect Tesla sales will be an important news story for 2017.

EVs remain a toy for the rich and famous, until the Model 3 and the Bolt, and other comparable models begin to be sold. These models will have base prices approximating $35,000. With the federal $7,500 tax credit, plus additional state credits, the selling price for these models after the tax credits will be within the reach of middle class buyers.

Unfortunately, other Americans will be footing the bill for these tax credits, so they will hurt American tax payers.

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Nothing to Fear, Part 4, The Miracle of Fossil Fuels, explains why fossil fuels have benefitted mankind, and can continue to do so for a thousand years.

Nothing to Fear is available from Amazon and some independent book sellers.

Link to Amazon: http://amzn.to/1miBhXy

Book Cover, Nothing to Fear
Book Cover, Nothing to Fear

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