Finance

Despite tough times for Tesla, EV sales set new record in second quarter

Published

10 months ago

August 2, 2024

Business Finance News

EV sales grew by over 11% in the second quarter. (iStock )

The electric vehicle (EV) market is in full swing globally, despite some tough times for EV-giant, Tesla. In Q2 2024, electric vehicle sales grew 11.3% in the U.S., according to a report from Kelley Blue Book. A record-high 330,463 units were sold in the quarter.

Sales grew thanks to more availability, continued discounts on EVs and a larger number of leases. General Motors led the charge for new products, helping to improve sales numbers. Tesla, however, saw a 6.3% year-over-year drop in sales volume. In fact, Tesla’s electric vehicle market share fell to 49.7%, the first time it’s dropped below 50% in the U.S.

Despite Tesla’s disappointing sales numbers, overall electric vehicle sales accounted for about 8% of all new vehicle sales in the second quarter, which is higher than the 7.1% of sales in Q1 2024.

“This increased competition is leading to continued price pressure, gradually boosting EV adoption. Automakers that deliver the right product at the right price and offer an excellent consumer experience will lead the way in EV adoption,” Cox Automotive Industry Insights Director Stephanie Valdez Streaty explained.

The most notable new players in the EV market in Q2 included the BMW i5, Cadillac Lyriq, Honda Prologue and Kia EV9 SUV. General Motors also added more than 21,000 new EVs, including electric options of the Chevy Blazer, Equinox and Silverado.

“We remain bullish on electric vehicle sales in the long term. The growth will, at times, be very slow, as all-time horizons in the automobile business are vast, but the long-term trajectory suggests that higher volumes of EVs will continue over time. As EV infrastructure and technology improve, and more models are launched, many shoppers sitting on the fence will eventually choose an EV,” Valdez Streaty said.

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Senate looking for ways to increase EV production

The U.S. Senate, namely the Budget Committee, met recently to discuss how to boost electric vehicle manufacturing within the U.S. Both Democratic and Republican leaders contributed to the discussion, aiming to capitalize on the growing market and compete globally.

Sen. Sheldon Whitehouse (D-RI) led the meeting, with Sen. Lindsey Graham (R-SC) also showing his support. As the senator of South Carolina, Graham pointed out that the state is a major vehicle assembler and tire exporter, so the production of EVs would make sense.

Many Republicans have stated their opposition to increased EV production, with many opposing President Biden’s goal of having 50% of all car sales be electric by 2030. However, Sen. Graham suggested that becoming a major EV manufacturer could boost the U.S. infrastructure.

Still, several senators raised concerns that the current electrical grid can’t handle the increased demand for electric vehicle charging. International competition was also a topic of discussion during the hearing.

China is the world’s largest manufacturer of electric vehicles. The country’s EV market is supported heavily by government funds, subsidies and tax breaks. Sen. Debbie Stabenow (D-MI), another state with a large automotive industry, raised her concern that the U.S. simply wouldn’t be able to keep up.

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LEASING A CAR MORE POPULAR, HIGH-CREDIT CONSUMERS CHOOSING TO LEASE MORE THAN 30% OF THE TIME

Auto market is down for corporations, heading up for buyers

Overall, the auto industry is evening out for consumers, but not so much for corporations. Used and new car prices are trending down, with many experts expecting a further dip.

Supply for new and used vehicles isn’t as tight as it was during the pandemic when supplies ran low, so buyers are less likely to pay way over the sticker price on vehicles. This means buyers have some of the power back. Dealers, on the other hand, have to offer discounts and deals to get buyers to make a move.

Until interest rates drop, however, financing a vehicle is likely to remain high. Paired with high auto insurance rates that are sticking around, car ownership is still far from affordable for many drivers.

Additionally, the competition coming from the EV market is hurting some dealerships and carmakers who are struggling to embrace the trend. Jim Farley, the CEO of Ford, described the company’s EV experience as “humbling”.

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Finance

China’s April retail sales growth of 5.1% misses expectations as consumption remains a worry

Published

4 hours ago

May 18, 2025

Business Finance News

Citizens are shopping at a supermarket in Nanjing, East China’s Jiangsu province, on March 9, 2024.

Costfoto | Nurphoto | Getty Images

China’s retail sales growth slowed in April, data from the National Bureau of Statistics showed Monday, signaling that consumption remains a worry for the world’s second-largest economy.

Retail sales rose 5.1% from a year earlier in April, missing analysts’ estimates of 5.5% growth, according to a Reuters poll. Sales had grown by 5.9% in the previous month.

Industrial output grew 6.1% year on year in April, stronger than analysts’ expectations for a 5.5% rise, while slowing down from the 7.7% jump in March.

Fixed-asset investment for the first four months this year, which includes property and infrastructure investment, expanded 4.0%, slightly lower than analysts’ expectations for a 4.2% growth in a Reuters poll.

The drag from real estate worsened within fixed asset investment, falling 10.3% for the year as of April.

The urban survey-based unemployment rate in April eased to 5.1% from 5.2% in March.

The data came against the backdrop of trade tensions between China and the U.S.

U.S. President Donald Trump placed tariffs of 145% on imports from China that came into effect in April. Beijing retaliated with tariffs in kind, with 125% levies on American imports.

Trade-war fears have receded after a meeting of U.S. and Chinese trade representatives in Switzerland earlier this month led to a lower set of levies between the world’s two largest economies.

Beijing and Washington agreed to roll back most of the tariffs imposed on each other’s goods for 90 days, allowing some room for further negotiation to reach a more lasting deal.

That prompted a slew of global investment banks to raise their forecasts for China’s economic growth this year while paring back expectations for more proactive stimulus as Beijing strives to reach its growth target of around 5%.

This is breaking news. Please check back later for updates.

Finance

Scott Bessent calls Moody’s a ‘lagging indicator’ after U.S. credit downgrade

Published

15 hours ago

May 18, 2025

Business Finance News

Treasury Secretary Scott Bessent said in an interview on NBC News’ “Meet the Press” that Moody’s Ratings were a “lagging indicator” after the group downgraded the U.S.’ credit rating by a notch from the highest level.

“I think that Moody’s is a lagging indicator,” Bessent said Sunday. “I think that’s what everyone thinks of credit agencies.”

Moody’s said last week that the downgrade from Aaa to Aa1 “reflects the increase over more than a decade in government debt and interest payment ratios to levels that are significantly higher than similarly rated sovereigns.”

The treasury secretary asserted that the downgrade was related to the Biden administration’s spending policies, which that administration had touted as investments in priorities, including combatting climate change and increasing health care coverage.

“Just like Sean Duffy said with our air traffic control system, we didn’t get here in the past 100 days,” Bessent continued, referring to the transportation secretary. “It’s the Biden administration and the spending that we have seen over the past four years.”

The U.S. has $36.22 trillion in national debt, according to the Treasury Department. It began growing steadily in the 1980s and continued increasing during both President Donald Trump’s first term and former President Joe Biden’s administration.

Bessent also told moderator Kristen Welker that he spoke on the phone with the CEO of Walmart, Doug McMillon, who the treasury secretary said told him the retail giant would “eat some of the tariffs, just as they did in ’18, ’19 and ’20.”

Walmart CFO John David Rainey previously told CNBC that Walmart would absorb some higher costs related to tariffs. The CFO had also told CNBC separately that he was “concerned” consumers would “start seeing higher prices,” pointing to tariffs.

Trump said in a post to Truth Social last week that Walmart should “eat the tariffs.” Walmart responded, saying the company has “always worked to keep our prices as low as possible and we won’t stop.”

“We’ll keep prices as low as we can for as long as we can given the reality of small retail margins,” the statement continued.

When asked about his conversation, Bessent denied he applied any pressure on Walmart to “eat the tariffs,” noting that he and the CEO “have a very good relationship.”

“I just wanted to hear it from him, rather than second-, third-hand from the press,” Bessent said.

McMillon had said on Walmart’s earnings call that tariffs have put pressure on prices. Bessent argued that companies “have to give the worst case scenario” on the calls.

The White House has said that countries are approaching the administration to negotiate over tariffs. The administration has also announced trade agreements with the United Kingdom and China.

Bessent said on Sunday that he thinks countries that do not negotiate in good faith would see duties return to the rates announced the day the administration unveiled across-the-board tariffs.

“The negotiating leverage that President Trump is talking about here is if you don’t want to negotiate, then it will spring back to the April 2 level,” Bessent said.

Bessent was also asked about Trump saying the administration would accept a luxury jet from Qatar to be used as Air Force One, infuriating Democrats and drawing criticism from some Republicans as well.

The treasury secretary called questions about the $400 million gift an “off ramp for many in the media not to acknowledge what an incredible trip this was,” referring to investment commitments the president received during his trip last week to Saudi Arabia, Qatar and the United Arab Emirates.

“If we go back to your initial question on the Moody’s downgrade, who cares? Qatar doesn’t. Saudi doesn’t. UAE doesn’t,” he said. “They’re all pushing money in.”

When asked for his response to those who argue that the jet sends a message that countries can curry favor with the U.S. by sending gifts, Bessent said that “the gifts are to the American people,” pointing to investment agreements that were unveiled during Trump’s Middle East trip.

Sen. Chris Murphy, D-Conn., criticized Bessent’s comments about the credit downgrade, saying in a separate interview on “Meet the Press.”

“I heard the treasury secretary say that, ‘Who cares about the downgrading of our credit rating from Moody’s?’ That is a big deal,” Murphy said.

“That means that we are likely headed for a recession. That probably means higher interest rates for anybody out there who is trying to start a business or to buy a home,” he continued. “These guys are running the economy recklessly because all they care about is the health of the Mar-a-Lago billionaire class.”