California has seen yet another decline in its statewide electric vehicle (EV) sales, resulting in an interesting turnaround for a state whose population once seemed to actively invest in electric cars.
While Tesla was hit hard within the state, thanks to ongoing competition, EV sales are slumping across the board. This could signal trouble for California Governor Gavin Newsom’s plan to ban the purchases of new gas cars in the future.
A New California Trend
In the middle of last year, the sale of electric vehicles in California began to trend down. Now, sales have officially turned negative, hinting at a new EV trend statewide.
Only 101,443 electric cars were registered in California in 2024’s second quarter. This is down from the 102,730 reported in 2023’s second quarter, signaling a drop of about 1.2%.
A Sudden Shift in Buying
This turnaround in EV sales comes after years of many people in California investing in and buying electric cars. This allowed the EV market within the state to really explode for many years.
Now, however, it appears things are changing. A new trend has emerged — and Californians aren’t as ready and willing to invest in EVs, it seems.
EV Growth in California Is Now Negative
Interestingly, the growth rate has suddenly changed in California, as well. Last summer, the EV growth rate was at 55%. By the fourth quarter of 2023, it had fallen suddenly to 16%.
Now, the growth rate in California is completely negative, marking a huge shift in how consumers are buying EVs.
Tesla Sales Plunge
Once upon a time, not too long ago, Californians considered Tesla cars to be the EVs to buy. Now, this mindset appears to have completely changed. Therefore, Tesla sales are plunging.
Tesla was hit the hardest, though it does remain the EV sales leader in the state. However, the company’s California sales fell by 42.1% in the second quarter.
Why Have Californians Stopped Buying Teslas?
Analysts remain slightly mystified about why Californian buyers have stopped investing in owning Tesla cars, especially because Tesla used to be quite beloved in the state.
Though there is no data to explain why this sudden shift against Tesla has occurred, analysts have agreed that an ongoing negative Tesla trend in California is apparent.
Tesla Drops in Sales Nationally
Californians aren’t alone in steering clear of buying Tesla EVs. Many Americans have also turned from Tesla, as seen in Kelley Blue Book data.
Nationally, Tesla sales have also dropped by 6.3%. This has occurred even as the total EV sales seen throughout the United States have risen by 7.3%.
Tesla’s New Challenges
Tesla notably only sells their cars directly to customers, as the company doesn’t use car dealers. California New Car Dealers Association (CNCDA) has explained that this data could result in Tesla facing many new challenges in the near future.
The CNCDA stated that Tesla “is facing mounting challenges. Its market share dipped 2.3 points from last year. … Tesla’s allure seems to be wearing off, signaling potential trouble for the direct-to-consumer manufacturer.”
Newsom’s Potential Difficulties
This latest data signals that California Governor Newsom may have a few new difficulties in the near future, as EV sales may only continue to decline, much as this trend suggests.
The state is attempting to meet its upcoming goal of fully banning the sale of new gasoline and carbon-emitting car sales. This goal must be met by 2035.
California’s Market Share
The CNCDA explained in this new report that the market share of all-electric cars has basically fallen flat. The first half of this year saw a market share of 21.9%.
Newsom’s climate plan to ban carbon-emitting car sales requires that all-electric cars’ market share in the state reach 35% by 2026. This may become a difficult feat for the state.
Trouble Ahead?
Clearly, this decline in EV buying in California could greatly hinder Newsom and California’s climate change mandate to get rid of the sale of new gasoline cars by 2035.
This electric vehicle mandate requires auto manufacturers to sell only electric cars, which can include both all-electric and plug-in hybrids. However, 80% of all car sales must be electric, while 20% can be plug-in.
Other Car Sales in California
Meanwhile, California auto sales across the board did rise by 4.8%, as seen in this second quarter data.
Analysts have noted that gasoline-battery hybrids remain popular for many Californians, as sales have risen by a notable 21%, even as full electric car sales have fallen.
