EVs outpace gas guzzlers

Life is a highway, and a bunch of US automakers just hit a big ol’ pothole.

Second quarter vehicle sales have arrived, and now that we’ve got the whole picture, we can see who’s racing for the checkered flag and who’s getting lapped.

Winners: hybrids and EVs

The Trump administration cut EV tax credits last year, raising prices for would-be buyers and hurting sales enough that companies like Ford, General Motors, and Honda have drastically reduced their EV production. But this year, upheaval in the Middle East convinced US buyers that being beholden to prices at the pump isn’t so great. That’s been a boon for hybrid and electric vehicles, and the companies that make them.

For example, Toyota’s sales of hybrids, EVs, and plug-in models soared 19.5% last quarter, and accounted for just under 57% of all Toyota cars sold in Q2. Hyundai just capped its best second quarter ever, thanks mainly to the 71% increase in hybrid sales over the last three months, while Honda touted its best quarter since 2021, fueled by “a record performance by electrified models.”

Don’t forget the EV powerhouses: Despite the lack of tax credits, for some Americans the same forces that have them test-driving hybrids also have them side-eyeing EVs. That’s great news for Tesla, which saw its deliveries surge 34% quarter over quarter and 24.9% year over year. But the announcement was pretty expected among investors, and the stock sank 7.49% in a sell-the-news decline.

Meanwhile, smaller EV player Rivian surged 8.44% thanks to better-than-expected vehicle deliveries. But Lucid Group dropped 8.45% after delivering a one-two punch of missing vehicle delivery estimates and announcing a bunch of management turnover.

Losers: US automakers

The decision by Ford and GM to cut EV and hybrid vehicle production made sense at the time, but it’s got to sting right about now. GM eked out a 0.64% gain after it revealed its second-quarter sales sank 4% year over year, while Ford shares tumbled 2.13% on a painful 10.3% decline in sales. Both companies highlighted problems in the EV market, especially Ford, which reported a 40.7% drop in EV sales.

The automotive industry is shifting as we speak, and some companies are prepared for it while others are being left behind. Peace in the Middle East and lower oil prices might swing the pendulum back in US automakers’ favor, but for now, they are stalling out.—MR