Both electric and hybrid vehicles are gaining popularity in the US, but most automakers are putting their money on compromise.
As EV Sales Slow, Automakers Race to Meet Demand
Electric and hybrid vehicles are more efficient than traditional gas-powered cars, but the technology behind them is different. Electric vehicles (EVs) run only on battery power, while hybrids and plug-in hybrids (PHEVs) utilize gas and electricity.
Why shift focus to hybrids as EV infrastructure continues to improve and more drives adopt the technology? The explanation is straightforward. As EV sales relaxed, hybrids and PHEVs still fly off the proverbial shelves.
Understanding the Numbers
In February 2024, the US hybrid and PHEV market grew five times faster than the EV market. Given that both electric and hybrid vehicles reduce dependence on fossil fuels, that’s still good news.
The sales of Ford hybrids rose by almost 37% in January and February 2024, and the hybrid version of Jeep’s Wrangler SUV accounted for half of the model’s total sales in the US during the second two quarters of 2023. The same is true for the hybrid Ford Maverick.
Auto manufacturers sometimes struggle to keep up with consumer demand for hybrid versions of their most popular vehicles.
Could the Shift in Strategy Compromise Energy Goals?
The Biden administration has been pushing pro-EV climate policies with the backing of environmental groups. The administration aims to force automakers to phase out internal combustion engines quickly.
The shift toward manufacturing more hybrids and fewer EVs may seem to fly in the face of that logic. With the US presidential election coming up in November, it can be seen as the automotive industry’s attempt at hedging its bets.
Electric and hybrid vehicles both reduce CO2 emissions. However, focusing on hybrids is the more profitable path to meeting long-term energy goals should a new administration change course and cool down the push for electric-only vehicle adoption.
Electric and Hybrid Vehicle Sales Expected to Continue Rising
Although the sale of EVs isn’t rising as quickly as hybrids, more energy-efficient vehicles are becoming the norm. AutoForecast Solutions believes hybrid production could increase to 20% of all cars by 2025, and EV production could rise to 14% of the total.
For some automakers, PHEVs constitute a perfect middle ground. They allow drivers to plug in and use electric-only modes to commute short distances and switch to hybrid mode for longer trips.
Given that many experts cite range anxiety as the primary barrier to adopting electric-only vehicles, that could be an excellent way to bridge the gap until better infrastructure emerges.
Manufacturers that supply automotive parts are also banking on the continued popularity of hybrids. Schaeffler, a German company that manufactures electric axles for hybrid systems, plans to open a new factory in Dover, OH, to accommodate American automakers’ needs.
Who Buys Hybrid Cars?
The average buyers investing in electric and hybrid vehicles are a little different. People who buy EVs are still considered by most to be early adopters. They’re willing to take on charging challenges to reduce their carbon footprints and untether themselves from the need for fuel.
People buying hybrids are usually looking for better fuel efficiency but aren’t ready to eliminate stops at the gas station. They tend to cite economic rather than environmental concerns as motivating factors.
Many of today’s most popular vehicles are switching to hybrid-only powertrains. As that happens, prices continue to drop. When EV pricing becomes more competitive, we may see a corresponding shift in consumer interest.
This post may contain affiliate links. Meaning a commission is given should you decide to make a purchase through these links, at no cost to you. All products shown are researched and tested to give an accurate review for you.