As much as I love electric vehicles, their faults are not lost on me. Charging infrastructure lacks, service outside of warranty is costly, and most of all, they’re really expensive. Despite the hurdles facing EVs in 2022, a new Bank of America Merrill Lynch Car Wars study predicts that EVs, PHEVs and hybrids will make up 60% of new models in 2026. With so many new electric cars coming making debuts in 2023 and 2024, time is running out to prepare the masses for the big changes ahead.
Car Wars? More Like EVs Wars…
Every year, Bank of America Merrill Lynch releases their cleverly-named Car Wars report. The report leverages the bank’s access to big data to forecast automotive industry trends like no other. In the 2022 Car Wars Report, John Murphy, a senior auto analyst at Bank of America Merrill Lynch, told Automotive News that he expects automakers to launch roughly 245 new models over the next four years. That averages out to 61 new models per year — 50 percent higher than the average over the past two decades.
Why the flood of new car models? Simply put, new powertrains inspire new models. No one wants to retrofit a billion-dollar electric powertrain onto a decades-old chassis.
Analysists took the strategies of each major automaker into consideration and shared their market share forecasts for model year 2025. Notably, Stellantis and Nissan are forecast to lose market share despite funneling billions of dollars into new electrified models. General Motors, Honda and European brands are forecast to maintain steady market share in the U.S. market. With the upcoming Silverado EV, Cadillac Lyriq and Equinox EVs just around the corner, it’s not what automakers like to hear at such a crucial moment.
The automakers with the highest model replacement rate fared best in the Car Wars analysis. Ford, Toyota and the Korean automakers have the highest expected replacement rate, and therefore are expected to gain market share.
However it’s what Bank of America thinks about Tesla that’s drawing headlines.
In the annual Car Wars study, Bank of America Merrill Lynch senior auto analyst John Murphy predicts that Tesla’s EV market share will drop from over 70% today to just 11% in 2025. That’s the most pessimistic Tesla forecast we’ve seen in a few years, harkening back to when talking heads from legacy automakers regularly predicted doom and gloom for Tesla.
Why the forecasted 60% drop in market share? Murphy cites the massive push to electrification from the likes of Ford, General Motors, Hyundai and Kia. It’s not clear if Murphy considered the significance of Tesla’s Supercharger Network, top-notch over-the-air update capabilities and high brand loyalty in his forecast. What do you think?
Looking for EV sales numbers? July is here, and that means the second quarter of 2022 has come to an end. As automakers release their Q2 2022 EV sales numbers, be sure to check the latest updates and statistics at CarEdge’s EV market share and vehicle sales report.
2023 Will Debut Blockbuster Electric Cars
Of the new models introduced between 2023-2026, 60 percent will be either electric or hybrid while 40 percent will be internal combustion. Among notable 2023 electric cars just around the corner are electric trucks, sedans, and a whole lot of crossovers.
- Chevrolet Silverado EV: With up to 400 miles of range, ultra-fast charging and massive vehicle-to-load power delivery, many truck buyers are passing up the F-150 Lightning and eagerly waiting for the Silverado EV.
- Fisker Ocean: This electric crossover starts at under $40,000, and even the top trims will hit the market under $70,000. Experienced automaker Magna will assemble the Ocean. I’m a fan!
- Chevrolet Equinox EV: Another electric crossover finalizing pre-production engineering is the Ultium-powered electric Equinox, which GM says will start around $30,000. Too good to be true?
- Honda Prologue: Perhaps you’ve wondered where Honda’s electric vehicles are? There are none, at least not in the North American market. That’s all about to change next year when General Motors begins building the Prologue EV for Honda. Yes, you read that right!
- Chrysler Airflow: The sleek Airflow concept is the vanguard of what Stellantis has on the horizon. This electric sedan is one of many Chrysler EVs to come, as the brand intends to go all-electric in just 6 years.
- Rivian R1S: The R1T electric adventure truck is already hitting the road, but next year will see accelerated deliveries of a full-size SUV that the market craves, the R1S.
The Takeaway: The Threshold Moment for Electrified Powertrains Is Here
Headline-grabbing claims aside, this EV market share forecast is in line with much of the industry’s thinking. In fact, automakers are sure to hope that these numbers become reality, as they are actively investing a cumulative total of roughly $500 billion dollars in electrifying their lineups.
With high-stakes new electric cars in 2023, legacy automakers are definitely taking EVs seriously. Which 2023 electric car are you most excited about?