When I heralded 2024 as the “Year of the Hybrid” in The Morning Dump back in 2023, it was timed precisely to a huge increase in hybrid car sales. It seemed obvious at the time that EV sales weren’t going to increase at some geometric rate, even though many still acted as if that was the case. I feel safe in saying that the rest of the decade is going to go to the hybrid.
The limited sales data we get from some automakers in October is out, confirming the massive negative swing in electric car sales due to the expiration of the EV tax credit. At the same time, hybrid sales are exploding and are likely to continue for the foreseeable future.
Do you want some great news? The chip shortage I wrote about on Friday may have a political solution, although I wouldn’t count my wafers until they’ve been fabricated. Also, Škoda is having a great year. That’s something to celebrate.
S&P Projects A Huge Share For ‘Electrified’ Cars
If I’m being 100% real, I did initially want to call this the “Decade of the EREV” given what’s coming from various automakers. America loves big trucks, and big trucks either require massive batteries or some other tradeoff in order to do big truck things. An obvious solution is to pair a generator engine with a battery pack that isn’t the equivalent of four Nissan Leafs.
I still think EREVs and, to a smaller extent, PHEVs will be a part of the picture. It’s just that full hybrids (FHEV) and mild hybrids (MHEV) solve so many problems at so low a relative cost that it seems like a no-brainer for almost every car out there. S&P Global Mobility is out with a fancy new chart showing the potential future mix, broken down by region:
S&P Global does great infographics.
As you can see, this is how much of the total share of various markets will be electrified in some sort of way. This ranges from 48v MHEVs all the way up to full BEVs. I can’t think of a single vehicle for sale that couldn’t be at least an MHEV, so it’s interesting to see that this isn’t the biggest area of projected growth. It’s hybrids.
There are a few reasons for this. Mostly, it’s just the cheapest way to solve the following problem: Electric cars are way more efficient than gasoline-powered cars, but gasoline has a way higher energy density than current batteries, which are not cheap.
My current CR-V Hybrid is floating around its 37 MPG combined average, and I never have to think about it. When it’s puttering around town, it’s mostly using stored energy. When I get going on the highway, it turns the motor on when necessary.
The other reason for hybrids coming in strong, as S&P Global Mobility notes, is that the regulatory environment in the United States is too unpredictable. We have a system wherein the Executive branch can dramatically change the universe in which carmakers exist. Flexibility is key, and while you can make a vehicle that can accept EV and ICE powertrains (this is what’s interesting about the BMW iX3), it does create some compromises:
Overall, manufacturers are shifting their focus toward flexible powertrain system strategies that can accommodate regulatory uncertainty and changing consumer preferences. The US market is likely to witness increased experimentation with transitional technologies such as REEVs and hybrids, as the industry navigates the complex interplay of incentives, policy, and consumer demand.
It’s all about flexibility going forward, although most companies will likely still create EV-only platforms to address the growing market for EVs. Looking ahead to 2030, if this projection is correct, then an increase in BEVs will be dwarfed by EREVs (they call them REEVs), MHEVs, PHEVs, and just plain old hybrids. That sounds right to me. [Ed Note: I think this study is underestimating EREVs/REEVs, but we’ll see. -DT].
October Sales Back Up The Trend
It was always clear that this month was going to see a massive reduction in EV sales as buyers stocked up on EVs while the $7,500 discount was still in play. So far, Hyundai, Kia, and Ford are out with October sales data, and this seems to support the “Decade of the Hybrid” thesis.
Let’s talk Hyundai, which saw its ongoing year-over-year sales streak finally come to an end as year-over-year sales dropped by a nominal 2%.
“Hybrid vehicles led the way in October with a 41% increase, and electrified sales were up 8%,” said Randy Parker, president and CEO, Hyundai Motor North America. “We saw strong EV demand leading up to the expiration of federal tax credits, and while that shift has temporarily disrupted the market, we’re confident it will reset. Hyundai’s momentum remains strong, and we’re on pace for record retail and total sales for the year. Solid fundamentals, smart inventory strategy, and an exceptional team and dealer network power us.”
I’m not a math genius, but if hybrid sales were up 41% and “electrified sales” were only up 8%, that means EV sales had to drop. Yup! The Ioniq 5 was down 63% year-over-year, and the Ioniq 6 dropped 52%. The cheap Venue was the biggest winner, up 49%, but the most important number for Hyundai was the 15% increase in Tucson sales.
Kia managed to keep its sales streak going by selling an extra 94 cars! That’s tight. The cheap Niro saw a huge 75% year-over-year increase, but the real winner in my heart is the now-hybrid Kia Carnival, up 35% over the same period. Ford’s total sales were up by about 2% in October, with electric vehicles down 25% and hybrids down 4%.
What’s up with hybrids? Ford is winding down sales of the Escape, which had a hybrid model, and hasn’t yet replaced it with a Bronco Sport Hybrid. Maverick sales were still up year-over-year, though I’m not sure of the breakdown of hybrids v. ICE for that or the F-150.
The Chip Shortage That Maybe Just Went Away
Full disclosure time: Our co-founder, Beau, has a few other businesses in addition to being a part of this one. Remarkably, there has been little to no editorial pressure or conflict of interest. There was some over the weekend, and I just feel the need to call it out when it happens, for the sake of journalist integrity. On Friday, I wrote about the Nexperia chip shortage that threatened to derail the auto industry. I made a joke about the film Breakin’ 2: Electric Boogaloo, noting that the film “was neither very good nor popular.”
Beau let me know via a stern text that not only did he think the film wasn’t so bad, but that he actually saw it in the theater. The only time I’d seen the film was projected on the wall of a house party in college, and was therefore not fully paying attention.
Taking any critique of my work seriously, I watched more of the film this weekend and looked up contemporaneous reviews. Roger Ebert actually gave it three stars, and made it clear he liked it better than Annie, which he didn’t like:
Remember all the self-importance of “Annie“? That’s why a modest, cheerful little movie like “Breakin’ 2: Electric Boogaloo” is so refreshing. Here is a movie that wants nothing more than to allow some high-spirited kids to sing and dance their way through a silly plot just long enough to make us grin.
Perhaps I was being too glib. I regret the error, but I also want you to know that we take editorial independence seriously here and that the Morning Dump will not be caving to pressure (from a certain North Carolinian taillight enthusiast) regarding my belief that “Son in Law” is the best Pauly Shore movie.
Oh, right, chips. Yeah, that whole thing with the politically-charged chip shortages seems to have resolved itself, according to this Bloomberg report:
Following the trade truce agreed by presidents Donald Trump and Xi Jinping at their summit last week, the US said on Saturday that Beijing will take steps to allow the Chinese facilities of Nexperia to resume shipments. This move, which confirms an earlier Bloomberg report, will likely ease worries about chip shipments that had threatened auto production as a trade fight between China and the US escalated.
The Dutch and Chinese arms of the same company are still beefing, but it sounds like they’ll keep doing their respective jobs and not disrupt a whole industry while they work out their issues.
Škoda Stays Singularly Superlative
My favorite modern Czech automaker (suck it Kaipan!) is the one arm of Volkswagen that doesn’t seem to be sweating it all that much. It doesn’t sell cars in North America, it never earned a huge stake in China that it’s suddenly losing, and it makes the kind of nice and cheap cars that consumers want.
According to a company sales release, through Q3 the company’s sales are up 14.1% year-over-year, and its balanced portfolio of ICE, EV, and hybrid vehicles is leading the company to big sales in Europe. Only Cupra is doing better, but that’s a relatively new automaker with less than half the volume.
It’s also expanding in markets like Vietnam and India, which are so far not as impacted by the global trade war:
Klaus Zellmer, CEO of Škoda Auto, commented: “Škoda’s strong nine-month results prove that our strategy is working: We are growing profitably, electrifying faster, and expanding globally. Holding firm as Europe’s No. 3 car brand while doubling deliveries in India shows the power of our team, our partners, and our customer’s trust. We’re driving forward with confidence, efficiency, and the courage to shape the future of mobility.”
Superb!
What I’m Listening To While Writing TMD
My wife put on “November Rain” by Guns N’Roses to celebrate the dawning of a new month, and I remembered that she wasn’t an MTV kid and had therefore not seen the extravagant video. If there’s a better way to start this month than Stephanie Seymour taking a luxurious pull of a cigarette, I’d like to know it.
The Big Question
Decade of hybrids, PHEVs, MHEVs, BEVs? What do you got?
Top photo: Honda
If your use case supports BEV for your DD (< 50 miles of driving a day, easy charging at home or work), it’s *really* hard to beat the BEV. Get in and go, never think about gas, most maintenance or really anything.
I love everything about my ICE cars, but when I have to do an errand or anything less than fun, it’s always in the BEV.
It would be hard to go back, frankly.
Certainly not for everyone, but as others have noted, once you try a good BEV for a DD, it’s hard to think otherwise
Just went full BEV for my DD. I love it and I can charge at work. Just did our first decent road trip (2 hrs each way) and it was awesome. Fast charging is really easy to find.
I’m part of the trend. Due to a family move to DC for the time being, I had to rid of all the cars, which were the suprisingly capable Aztek and the fully loaded E91 legend. Their place was taken by a new 2025 CX-50 Hybrid Preferred, the only “slicktop” trim you can buy (the 2026 base got the pano roof, so I avoided it).
Did a 115 mile trip today. Since car has barely 300 miles on it, drove it gently. Still never held up traffic, did a fair amount of both 50ish mph and 75-80 mph. The powertrain is easy to drive in the city, but nimble enough on the highway, and quiet when driven gently. Reported 41 mpg for the trip, which is basically its lifetime average (300 miles, mind you, it’s brand new). It predicts the first tank to last about 500 miles, but I don’t believe that. Anything 400 miles is stellar on cheap gas, as I’ve heard you can only put 10 gallons or so in it.
Hopefully the massive increase in hybrids will still result in some battery manufacturing capacity? Obviously a small fraction of the batteries needed compared to a BEV, but I hope enough to warrant investment.
I love my hybrid, and future non-performance vehicles in my collection will likely be some form of full hybrid or plug-in hybrid.
I haven’t thought about November Rain in a long time. My friend from high school is in the video, He’s the waiter at the 6:29 mark. When I saw him a few years after this video he told me that what ever you imagined of the amount of drugs, booze, and girls was you should double it and add 30. The 80’s and early 90’s were a different time.
Hybrid is gotten so cheap and people trust them. Maybe phev or erev as battery costs come down. At a certain point Bev will be cheaper. We might be there already. When the sodium batteries take off Bev will be extremely cheap. I suspect just like anything there will be a mix. But who knows the us basically avoided diesel cars when they took over most places. Some people take 20 years to convince. That should put us at about 2032 for wide scale trust in Bev.
From the chart up top, I wonder how many times hybrids will have years where they are the dominant powertrain in any large markets, and if there will be any years where they are the largest group worldwide. Looks like in Japan/Korea they likely will be. China, worlds largest market, doubtful. Europe, maybe briefly the next few years. North America, maybe by a small margin, but by the time they pass up pure ICE in the 2030’s, they might not be much ahead of EVs.
The 2010’s should have been the decade of the hybrid. By 2020, hybrids should have been quite dominant. The tech was there, but apparently not the consumer interest, or the corporate interest to invest to produce in very large volumes.
I just bought my first ever hybrid a few weeks ago. While I really wanted an ID Buzz, it’s laughably expensive for the range so I ended up getting a Sienna. While the powertrain is really rough and tin-y sounding, it ends up feeling pretty smooth due to Toyota’s hybrid magic. It’s the first start-stop that is basically unnoticeable, ~650 miles of range is longer than I can handle, AWD is perfect. It’s just so hard to argue with 34mpg we’ve been getting for the first 1000+ miles. Honestly, makes me wish I looked at hybrids earlier because they seem to round out so many rough edges.
Yeah, if you’re in the market for a minivan you’re NOT going 650 miles between stops, unless you run a courier service.
Given that this is Autopian, my sense is this will be the decade of amazingly depreciated ICE and my inner cost accountant is calculating the petrol cost vs the additional cost of the fancy pants stuff Also I want the red Alfa Guilia discussed in the other article.
My house still stuck solely in the dino-juice era. I think my spouse would appreciate the convenience, quiet, etc. of an EV, but she’s still a ways away from buying her next car.
What I got? Two old vehicles pre-smog check, one old truck that needs to be smogged, one hybrid and one PHEV. We’re good for several years.
Considering the Camry and similar cars and crossovers of their ilk are not even offering non-hybrid drivetrains, this whole premise of customer preference is somewhat skewed.
That being said, if Toyota can make a vehicle running form a battery that is charged by a gas engine then they could offer that same vehicle with say an additional 300 plus pounds of battery in the space taking up the motor and probably 100 lbs of battery in the place of the fuel tank and sell BEV versions of anything if people had the druthers to purchase one. So, it makes some sense to go Erev on about everything and then just adapt to full electric should the infrastructure and desires of the masses change to make a BEV something more people want.
Camry and others being hybrid only just shows the maturity of that technology and acceptance by customers. Customers must be showing that overall they either prefer the hybrid or are indifferent.
It’s the latter. They just don’t care enough about cars.
An EREV is better than a hybrid. The motor charging the battery and not connected to the wheels in any way is more efficient use of the fuel.
…until you get out onto the highway.
An Erev is a Hybrid by definition, just a different methodology to get there. The term you like seems to be a series hybrid versus a Parallel hybrid. I think Parallel was popular in the early 2000’s more so because if the Hybrid Battery failed in some manner you could still limp home on ICE motor alone. Just a thought though, maybe they were cheaper and more reliable then as well?
It’s been decades, but every once in a while it still occurs to me that I haven’t seen or heard Paulie Shore and I smile.
Breakin’ 1 & 2 (Electric Bugaloo was a meme in the ’80s, well before they called it that) were ’80s kid movies. IMO, they weren’t good (I’ve always despised musicals of any kind), but they always seemed to be on one of the 30 stations + HBO that we had on TV. They were inspiring, though, and we’d go out, throw down some cardboard, and try not to hurt ourselves too badly. Our parents always stressed that nobody would try the head spin because we could break our necks. One kid’s visiting cousin didn’t listen one day and he fell down in a heap onto his back, claiming he couldn’t move. Not being old (smart) enough to weigh relative consequences of not listening to parents vs abandoning someone in medical distress, we left him like we had nothing to do with it. I’m 99% sure he was faking, though, as he showed up later and claimed the feeling came back and he was fine. Either way, I always found it amusing that we were such stupid assholes that we left him to avoid getting into mild trouble.
I much preferred other movies that were always seemingly on, like Last Dragon and Big Trouble in Little China (still one of my favorites). I normally disagreed with the humorless Siskel and Ebert who almost always got it wrong for every future cult classic or Lynch film, but Annie was torture.
“This is Jack Burton in the Pork Chop Express, and I’m talkin’ to whoever’s listenin’ out there”.
Most people will likely remember Alfonso Ribeiro as Carlton on “The Fresh Prince of Bel-Air”, but I shall always remember him for his break dancing.
https://www.youtube.com/watch?v=RqhjviixsSE