Electric-vehicle sales seem to be heading in two directions at once.

On the one hand, we hear about how EV sales are climbing, how everybody and his brother seem to be buying one, but then these reports are quickly followed by dire news stories that indicate the exact opposite. 

For instance, car-rental giant Hertz Global Holdings  (HTZ) – Get Free Report recently said it was planning to dump around a third of its global fleet of electric vehicles amid a slump in resale prices and a surge in repair costs. 

The company said it would sell around 20,000 EVs this year and reinvest the proceeds to buy traditional gas-powered cars. 

S&P Global Mobility recently found households with internal-combustion-engine-powered cars to be more likely to transition to a hybrid or plug-in hybrid than to a fully electric vehicle.

As a result, some automakers have either scrapped or abandoned various electric-vehicle expansion projects, and former President Donald Trump has assailed EVs, claiming they’re “too expensive” and “don’t go far enough,” CNN reported.

EVs fast-growing car-sales category 

And yet last year electric vehicles represented the fastest-growing car-sales category, holding a 7.6% share of the total U.S. vehicle market in 2023, up from 5.9% in 2022, according to Cox Automotive’s Kelley Blue Book.

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EV sales hit a record for both volume and market share, with sales reaching 52% higher than in the fourth quarter of 2022.

Americans bought 317,168 EVs from October through the end of December 2023, representing 8.1% of all new cars sold.

“The momentum is strong for more when it comes to EVs – more new product, more incentives, more inventory, more leasing and more infrastructure – and that momentum is not going away,” Stephanie Valdez Streaty, director of Industry Insights at Cox Automotive, said in a statement. 

Streaty said that transaction-price parity between internal-combustion vehicles and EVs looks more realistic in the coming years.

She said this would be good news for buyers, who currently see EV pricing as out of reach. She added that “our team forecasts that EV share of the total U.S. market will reach 10% in 2024.”

Still, EVs remain expensive, with the average price paid for a new EV last month coming to $50,789, according to Kelley Blue Book estimates. 

Shifts in tax incentives will both help and hurt buyers in the year ahead – fewer vehicles now qualify, but dealers’ ability to apply tax credits at the point of sale will help.

And while records were set, Kelley Blue Book also said the slowdown is indeed real. 

“The EV market in the U.S. is still growing but not growing as fast,” Kelley Blue Book said.

That’s a potential problem for Tesla, especially in the increasingly competitive luxury market.

Cox: 2024 is the EV ‘Year of More’

Tesla  (TSLA) – Get Free Report continued to dominate the EV market last year, with 55% of the electric vehicles Americans purchased coming from the company headed by CEO Elon Musk.

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“Tesla remains the undisputed champion of EV sales in the U.S.,” Kelley Blue Book said.

The sales figures were down from 65% in 2022, but Kelley Blue noted that Tesla’s aggressive campaign of price cuts helped it retain its top position in 2023. 

Sales of the Model S luxury sedan were down nearly 50%, sales of the Model X full-size SUV dropped nearly 12%, and midsize-SUV Model Y sales climbed nearly 57%.

The Model Y became the bestselling car in the world last year, beating out the Toyota  (TM) – Get Free Report Corolla and marking the first time an electric vehicle made the No. 1 spot.

The Model Y, according to the auto review firm Edmunds, is “one of the most popular electric cars on the road thanks to excellent electric range, loads of in-car tech and swift acceleration, especially in the Performance trim.”

Tesla was the bestselling luxury brand in the U.S. in 2022, according to Automotive News, beating out BMW  (BMWYY) – Get Free Report by more than 156,000 registrations. 

However, BMW and other German automakers had a good year in 2023, chipping away at Tesla’s lead. BMW’s sales more than doubled (up 102%) for the fourth quarter and nearly tripled (up 191.3%) for the year. BMW i4 and BMW iX sales grew 205% and 135% year-over-year in 2023.

Mercedes-Benz MBGYY fourth-quarter sales rose 90.4%, with full-year sales surging 225.7%. It sold more than 40,000 of its EQ series models, led by the EQS.

Last year, 12.5% of all new BMW sales were EVs. Mercedes-Benz and Audi also increased their EV sales in 2023, accounting for 11.4% and 11% of total brand sales, respectively.

For perspective, Tesla’s luxury Model S and Model X sales slumped by 50% and 12% in 2023, respectively.

“The Cox Automotive Economic and Industry Insights team is calling 2024 ‘the Year of More’ when it comes to EVs,” the firm said. “More new product, more incentives, more inventory, more leasing, more infrastructure – all the more will combine to push EV sales higher in the year ahead.” 

That could mean these luxury car market trends continue this year.