Electric and Hybrid car manufacturers such as General Motors Company (NYSE:GM), Toyota Motor Corp (ADR) (NYSE:TM), and Honda Motor Co Ltd (ADR) (NYSE:HMC) plus many market analysts have been surprised by the reduction in car sales this year compared to last year. According to MarketWatch, the sales through August this year stands at 3.6% of the market while that of last year is 3.7%.
Many companies and market analysts had predicted constant increment in sales with several environmental crusaders creating awareness on the importance of using such cars. A number of manufacturers also dished out great offers with the confidence that sales would boom.
However, the sales didn’t grow as expected!
The American Government had also put forth a goal in 2011 of ensuring that 1 million electric cars are on the road by 2015. This gave many line companies the momentum to go into higher production drive with the hope that sales would explode.
The year 2013 wasn’t that bad after all. The companies managed to sell close to 600,000 electric and hybrid cars, according to Edmunds.
“As the summer months wind down, we’re approaching the time of the year when sales of these vehicles tend to be slower, so a late-year surge isn’t very likely,” said Jessica Caldwell, an Edmunds.com analyst.
Some experts have attributed the drop in sales to the fact that gas prices are stabilizing, making it possible for more people to purchase guzzlers and sports utility automobiles.
Chevrolet Volt, an electric car manufactured by General Motors Company (NYSE:GM) has also experienced a decline in sales, managing only 13,146 units through August this year. This is way below what Dan Akerson, a former Chief Executive had projected in 2012.
Toyota Motor Corp (ADR) (NYSE:TM), and Honda Motor Co Ltd (ADR) (NYSE:HMC) have also experienced lower performance this year with Toyota Pius registering 11.5% lower sales while Honda’s Civic hybrid, Accord plug-in hybrid and Fit EV all registering double-digital decline.
Tesla Motors Inc (NASDAQ:TSLA) and Nissan Motor Co Ltd (ADR) (OTCMKTS:NSANY) are two companies that have registered success this year. The all-electric Nissan Leaf registered a 34% rise in sales through August while Tesla’s Model S registered a worldwide sales increase of 47%.
Nissan Motor Co Ltd (ADR) (OTCMKTS:NSANY) has carried out a lot of awareness campaigns and increased number of roadside charging stations, leading to its successes. Tesla Motors Inc (NASDAQ:TSLA) has also extensively marketed its Model S brand and taken advantage of the international market.
U.S. sales chief Fred Diaz still believes that things are still brighter ahead for the electric and hybrid vehicles. He however says that he doesn’t expect the market to “explode overnight”.
This article has been written by Victor Ochieng.