Just two years ago, Tesla was on top of the world, selling the most cars in its history, 1.31 million electric vehicles, fueled by a reduction of its prices. Now, in early 2025, the price of some of Tesla's models are dropping, and the market for pre-owned Teslas is, in the words of Mashable, "cratering." The company's stock price continues to drag as CEO Elon Musk's involvement in the US government as head of DOGE has led to showroom protests and an overseas buyers' backlash.
But all the news about Tesla has not slowed down sales for electric vehicles despite indications last year of a plateauing market for EVs. According to Motor Intelligence, 3.2 million hybrid or electric vehicles were sold in 2024, comprising 20 percent of the auto market, a record in the US. Even though 1.9 million of those were hybrids, sales of EVs were solid even amid uncertainty about federal credits and all the bad publicity for Tesla.
Ivan Drury, director of insights at the auto online resource company Edmunds, said that the EV industry is in a rapid transition.
"(There's) more change happening in the last few months than there has been in like a 10-year period when it comes to EVs and not just Tesla." he told CNET.
A Tesla Cybertruck is seen parked outside a dealership.
jetcityimage/Getty ImagesDrury says that Tesla's lead position in EVs has allowed it to draw customers with incentives on top of tax credits and that even the dump in used-car prices is creating a funnel effect for price-conscious customers new to the EV market, which could benefit the company in the long run.
There's much more competition in EVs with new models and players in the market, EV ranges are improving, and lease deals are becoming more attractive, Drury says.
"Leasing was damn near three quarters of all dealership purchases of EVs last year," he said. "With the ranges so much higher, 250, 300 miles, it's a more viable product. Customers are far more willing to give up their existing transportation."
Ironically, Musk's alignment with president Donald Trump's administration may have the inadvertent effect of opening up a significant new customer lane for EVs. BJ Birtwell, the CEO of Electrify Expo, a hands-on convention for the EV curious held in eight US cities, says he's spoken to thousands of potential EV customers and has seen a distinct demographic shift.
Prior to last year, lots of Electrify Expo visitors were well-versed in the EV market. That's changing.
"About eight to 12 months ago, there was a new demographic coming out to our festival who couldn't talk shop," Birdwell says, "They didn't understand the lingo, they were just coming to see if the whole electric thing was right for the, and that's the whole purpose of our festival."
Birdwell says the politicization of EV environmental benefits has hurt the industry and the growth of electric vehicles, but a new base of customers who don't care about sustainability are leaning toward EVs because they are more aligned with Musk's political views.
"We started to see that shift about the middle of last year," he says. In red-state cities, such as Orlando, ticket sales have tripled for Electrify. "We're really leaning into this idea that these customers, or this audience, has been somewhat alienated in the past is warming up to electric cars. They feel like the government isn't telling them what they should drive and now it's their decision."
Birdwell says it's too soon to say if the influx of new customers will balance out those who are bailing on Tesla for political reasons. "It's cutting both ways. Only time will tell how this all nets out."
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