Hybrid Vehicle Sales Continue to Rise as Electric and Plug-in Vehicle Shares Remain Flat
In the first quarter of 2025, about 22% of light-duty vehicles sold in the United States were hybrid, battery electric, or plug-in hybrid vehicles, up from about 18% in the first quarter of 2024, according to estimates from Wards Intelligence. Among these categories, hybrid electric vehicles have continued to gain market share, while battery electric vehicles and plug-in hybrid vehicles have remained relatively flat.
These different vehicle types affect the broader energy sector in various ways. Battery electric vehicles and plug-in hybrid vehicles can consume electricity from isolated power sources or, more commonly, from the grid, affecting electricity demand. In contrast, hybrid electric vehicles do not have plugs and therefore don’t directly affect grid-delivered electricity demand.
The decrease in electric vehicle sales was driven by declining sales of battery electric models such as the Honda Prologue, Chevrolet Equinox, and Tesla Model Y. These declines were partially offset by increased sales of other battery electric models, such as the Volkswagen ID.4 and Toyota bZ4X. Notably, battery electric vehicle sales are more common in the luxury vehicle market. U.S. luxury vehicles accounted for 14% of the total light-duty vehicle market in the first quarter of 2025, the lowest share since mid-2020. Electric vehicles accounted for 23% of total luxury sales in the first quarter of 2025, down from over one-third of luxury sales in 2023 and 2024, following Wards’ reclassification of the Tesla Model 3 as non-luxury in late 2024.
Battery electric vehicles’ average transaction prices remain significantly higher than the overall market average. The average transaction price increased from $55,500 in December 2024 to $59,200 in March 2025, compared with the average price of all new vehicles, which decreased from $49,700 to $47,500 during the same period. This 25% difference between battery electric vehicles and the industry average prices in March 2025 was the highest since April 2023.
It’s worth noting that while electric vehicles accounted for around 10% of recent sales, their share of the total light-duty vehicle fleet is much lower. According to data from S&P Global, in 2023, electric vehicles accounted for less than 2% of all registered light-duty vehicles in the United States.
