Tag Archives: GlobalData

Where’s Affordability?

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Prices keep going north, not south. . .

By Gary S. Vasilash

Apparently vehicle affordability is like the weather, with lots of talk and not much else.

According to the just-released JD Power and GlobalData report for February 2026 new vehicle sales, the average retail transaction price is expected to be $46,303, a 2.7% increase over last year.

That’s a 2.6% bump for EV prices (to $46,528) and a 3% bump for the rest (to $46,097).

Isn’t that a move in the wrong direction for consumers?

What is surprising is that discounts for EVs in February are expected to average $10,356—and that’s a reduction of $1,664 from February 2025.

So that would mean that last February there were an average $12,020 in discounts and potentially a $7,500 tax credit. With all that on offer, on the order of $19,500, it would seem that lots of EVs would have been sold in February 2025, yet the firms note that for this February EV sales will be off only 1.8% from last year, to 6.6% of the market.

Didn’t some auto execs last February look at those numbers and consider that maybe the consumer demand wasn’t turning out the way they thought it would? Yes, the elimination of the tax credit was a huge blow, but when big discounts aren’t getting it done, you’ve got to wonder.

And here’s something that speaks to the K-shaped economy that is now manifest in the U.S.

Speaking to the issue of the decline in EV sales, Tyson Jominy, senior vp of OEM customer success at JD Power, said:

“The pullback is concentrated in the mass market, where EV share contracted to 1.9% from 4.0% a year ago. In contrast, EVs represent over 26.4% of premium sales year to date – a figure which includes direct-to-consumer brands – and only 5 percentage points below last year’s pace.”

Apparently the premium space has plenty of EV sales, comparatively speaking.

Another affordability-related finding is that even though the average interest rate for new-vehicle loans is 6.72%, a decline of 0.31 percentage points from February 2025 the average monthly finance payments are up $32, to $811.

Also up in the finance space is the percentage of loans that are greater than or equal to 84 months (a.k.a. seven years): 12.7%, an increase of 5 percentage points from February 2025.

Again, a move in the wrong direction if affordability is what everyone would like to achieve.

Makes you think “everyone” isn’t all that interested in achieving it.

EV Sales Elsewhere

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Seems like the EV slowdown is happening elsewhere, too

By Gary S. Vasilash

The South Korean-based brands—Hyundai, Kia and Genesis—are producing some of the most-appealing electric vehicles available in the U.S. market.

Award-winning Kia EV9 (Image:Kia)

Consider, for example: for the 2024 North American Car, Truck and Utility Vehicle of the Year Awards, the Hyundai Ioniq 6 was one of the three finalists in the Car category. The Genesis Electrified GV70, Hyundai Kona/Kona EV, and Kia EV9 were the three finalists; the EV9 received the award.

And, of course, these products (and others, too) are available to Korean consumers.

GlobalData has run numbers for how well electric vehicles are doing in the home market of those companies, and finds that through April 2024, zero-emissions vehicle sales in Korea, 97% of which are EVs and the balance fuel-cell vehicles, are down 17% compared with April 2023.

Meanwhile, hybrids (including plug-ins) are up by some 45%.

Why are EVs not doing so well? GlobalData suggests:

  • Early adopters have gotten them. The majority isn’t buying yet.
  • And on the subject of buying, there is the comparative higher costs of EVs.
  • Charging is a concern.
  • Residual value decreases make an EV purchase less appealing.

GlobalData points out that while there had been dismissiveness expressed by some pundits regarding hybrids as being a bridging technology between internal combustion engine vehicles and EVs, the numbers are showing that that is indeed the case.

The good news for Hyundai, Kia and Genesis is that they offer compelling hybrid products as part of their global portfolios, too.

Some Numbers in China

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Ever wonder why Western governments are concerned about their domestic auto manufacturers?

By Gary S. Vasilash

The U.S. is applying big tariffs on electric vehicles from China (as in 100%), and the European Union, moderately big (38%). (Apparently the Chinese are doing a bit of retaliation, as it has opened an investigation into pork products exported from the EU.)

Some numbers from GlobalData provide a sense of the sort of numbers associated with Chinese vehicle manufacture that are concerning to those in the U.S. and Europe.

Looking at sales of passenger vehicles in China from January to through April, there was an increase of 5.5% year-over-year to 6.3 million units.

But the red flag is this number: a rise in production by 9%, or 7.6 million units.

Simply: 1.3 million more passenger vehicles made than sold.

This means overcapacity. Which also means that companies are probably interested in finding markets where they can offload those excess vehicles.

And while the 7.6 million number  is all passenger vehicles, not just those with batteries in addition to the 12-V battery under the hood, in April there were 424,0000 vehicles exported from China, a year-over-year increase of 36.9%.

And those joint ventures. . .

Once, Western brands were almost giddy when it came to the opportunity to create joint ventures in China with Chinese companies. The market size was (and is) nothing short of amazing.

GlobalData finds that when it comes to NEVs—or “New Energy Vehicles,” which are the hybrids and full EVs—the penetration rate of Chinese local brands was close to 60% of the market, up 7% from the same period last year, while the joint venture brands have a penetration rate of 12%–still up from last year’s number. But only 1%.

So one can expect the Chinese OEMs that produce NEVs to up the production of those vehicles, which will undoubtedly lead to overcapacity there, too, which means they’ll have to do something to do with those vehicles.

And that something is probably exports.

How Will February Look Sales-Wise?

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By Gary S. Vasilash

J.D. Power and GlobalData project that February sales will come in a smidge—1.4%–more than they were in February 2023, or 1,214,600 vehicles

Taking out non-retail transactions, the number is 981,300, which is the important number because that reflects individual consumers.

So using that as the basis of comparison, there is an increase of 3.8% compared to the same month last year.

One of the reasons for the rise this year is something that happens once every four years: an additional day of sales, February 29.

According to Thomas King, president of the data and analytics division at J.D. Power, the increase in sales is facilitated by:

  • Higher inventory levels (when there are cars on the lot, then there is less pressure to have to select whatever is available from a paltry number)
  • Higher manufacturer incentives (turns out that there is a need to provide a boost to get the sheet metal moving)
  • Lower dealer profit margins (seems that the profits that were rolling in when choice was minimal so prices were maximal are now trending back to normal—but it is worth noting that about 17% of vehicles are still selling above MSRP, although last year it was nearly 32%)

What this means is that people are getting bullishly back in the market.

King:

“Transaction prices in February are trending towards $44,045, down $1,919 or 4.2%—from February 2023. However, despite the significant decline in average transaction prices, higher sales volumes mean consumers are on track to spend nearly $40.8 billion on new vehicles this month—the highest on record for the month of February, and 4.1% higher than February 2023.”

Could be a case of the proverbial “making it up on volume.”

Nowadays, it is impossible not to look at how things are going in terms of EV sales.

Elizabeth Krear, vice president, electric vehicle practice at J.D. Power, said, “In 2023, EV sales and leases accounted for a larger percentage of retail auto industry growth than gas-powered vehicles.”

Presumably that has something to do with the fact that there is a stable number of gas-powered vehicles so the growth would not be as big as that of EVs, which start from a comparatively smaller number.”

She acknowledged what is now frequently heard: EV sales are slowing.

Putting some numbers to it:

“In January, battery electric vehicle sales fell 1.6 percentage points from 9.2% in December 2023. Further, upper-funnel EV shopper interest declined for a fourth consecutive month. New-vehicle shoppers who are ‘very likely’ to consider purchasing an EV for their next vehicle dropped to 25.6%, a full percentage point lower than in December.”

Krear said that a big blockage for EV buyers: charging access.

While she noted that the opening of the Tesla Supercharger network will go a long way toward addressing that issue, she added, “But this alone is not enough to move the needle. Improvement is needed in terms of the availability of affordable EVs for mainstream customers.”

Yes, it all comes down to an affordable MSRP.