Electric Car Sales Plunge To 4 Year Lows

But low oil prices are supposed to be unequivocally good? On the day when Ford lays off 700 Michigan plant workers in small cars and hybrids manufacturing, The Detroit News reports that, according to Edmunds.com, sales of electric cars and hybrids are at the lowest level since 2011. What is even more worrisome, motorists who leased those first-generation cars, and have decided not to buy them, are turning them in, leaving dealer lots full of low mileage cars at huge discounts to new ones. As Edmunds concludes, while "the government's going to keep pushing it, there is time to pause right now."

 

Low oil prices have not been unequivocally good for these workers... (as Detroit Free Press reports)

Ford said today that it is planning to cut a shift at its Michigan Assembly Plant where it makes the Ford Focus compact car and C-Max crossover because of declining sales of small cars, hybrids and electric vehicles.

 

The automaker told workers and notified the state of Michigan that it will lay off 700 workers, starting June 22. The decision affects 675 hourly workers and 25 salaried employees who make the Focus, Focus ST, Focus Electric, C-Max hybrid and C-Max Energi plug-in hybrid at the Wayne plant.

 

The first 200 workers will be laid off in June, another 200 at the end of July and the remainder at the end of September.

But it is the burgeoning electric car market that is seeing desparate times (as The Detroit news reports)...

Sales of new electric cars and hybrids, according to automotive research and shopping site Edmunds.com, are at their lowest level since 2011 — the first full year of sales for the groundbreaking Chevrolet Volt plug-in hybrid and Nissan's all-electric Leaf. So carmakers are paring prices in an effort to get them moving.

 

Furthermore, motorists who leased those first-generation cars, and have decided not to buy them, are turning them in. They're on dealer lots with still relatively low mileage, and at prices considerably cheaper than the new ones.

 

Even with $7,500 federal tax credits and other incentives, automakers such as General Motors Co., Ford Motor Co. and Nissan have dropped prices in an attempt to move their new hybrids and electrics. Cadillac became the most recent to reduce the sticker on an electric car, when it whacked $9,000 off its ELR plug-in hybrid last week.

 

"EVs are just not selling; even hybrids and plug-ins are slow," said Caldwell. "There's some concern."

 

"That's the reality of the situation," said Jessica Caldwell, senior analyst for Edmunds.com. "They have to push them out at those levels for people to be interested. It really seems like the cachet of EVs and hybrids has faded away."

 

...

 

New mainstream plug-in hybrid electrics can sell for more than $30,000 with up to $7,500 in federal tax credits. But used models are selling for less than half of their original amount.

 

Used plug-in car values have been lower than comparable vehicles with traditional combustion engines since launching, due to the heavy federal tax credit and inflated pricing, according to Kelley Blue Book director of residual value consulting Eric Ibara.

 

"All along, we had a very strong suspicion that they wouldn't hold the same (residual value) percentage with traditional vehicles," he said.

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It appears we are going to need more government "incentives"...

We levae it to Ford UAW President Jimmy Settles (ironic name?) to summarize:

"We are reminded from time to time that our industry is cyclical and volatile to market conditions."