A record number of electric vehicles (EV) were purchased in the U.S. last year.

Kelley Blue Book reported 1,189,051 new electric vehicles (EVs) were put into service. For 2023, EV’s made up 7.6 percent of the market, up from 5.9 percent in 2022.

In its release Jan. 9, Kelley found fourth quarter EV sales set a record for both volume (317,168) and share (8.1 percent) respectively, the underlining show that dealers claims that a slowdown is real.

Sales Slowdown

While the last quarter sales were up 40 percent year-over-year, it is down from previous quarters. The market posted a 49 percent gain in Q3, and EV sales were up 52 percent year over year in Q4 2022. By volume, EV sales in Q4 were higher than in Q3 by roughly 5,000 units.

Tesla continues to dominate, accounting for 55 percent of the EV market in 2023 in the U.S. But Kelley notes that is down 10 percent from 2022 as Tesla’s falling to an all-time low in Q3 before rebounding in the last quarter.

Tesla’s share of the total U.S. market reached an all-time high of 4.20 percent in calendar year 2023, with the Model Y accounted for 33 percent of all EVs sold in 2023.

New products are resulting in a resurgence of luxury EV buyers back to the traditional European nameplates. Last year, 12.5 percent of BMW sales were EVs; Audi and Mercedes EV now account for 11 percent and 11.5 percent of total brand sales, respectively.

Price Difference

According to December transaction price data, the transaction price parity between internal combustion engine vehicles and EVs looks more realistic in the coming years —but EVs still remaining more expensive.

The average price paid for a new EV in December 2023 was $50,789, according to Kelley Blue Book estimates. Shifts in tax incentives are a mixed bag in 2024 as fewer vehicles now qualify, but the ability for dealers to apply any tax credits at the point of sale will help.

Only two EV’s last months had a manufacturer’s suggested retail price below $40,000: the Chevy Bolt and Nissan Leaf.