Car makers round off difficult 2024 with further drop in car sales and lower output
With Three A In A Us, To Last 3 12% Boost Year Sales In The 1 The Months The Of Million Car Bit Electric Sales Of The — Growing Year End Saw
Car manufacturers around the world rounded out a difficult 2024, with further drops in car sales, loss of tax credits and lower production output.
South-Korean car manufacturers Hyundai and Kia said they were aiming to grow their combined global sales by 2% in 2025, to just under 7.4 million cars, after missing sales targets in 2024.
The automakers, which together rank third in global vehicle sales, sold 7.23 million vehicles in 2024, slipping 1% from 2023, as solid US sales were offset by sluggish demand in Europe and their home market.
The two carmakers are bracing for the slowing economy and political uncertainties in the United States and South Korea that threaten to dampen demand.
In the US, electric car sales saw a bit of a boost in the last three months of the year — growing 12% to end the year with 1.3 million sales.
However, these figures were potentially bolstered by US president-elect Donald Trump’s threat to eliminate tax credits for electric cars after he takes office on January 20.
Some car manufacturers such as Volkswagen and Stellantis — which owns Jeep, Dodge and Fiat — have already lost access to US tax credits under tougher rules that took effect this week.
Shares in both companies declined after VW’s ID.4 electric crossover lost its full $7,500 (€7,284) tax credit, while certain Stellantis models were deemed ineligible for the €3,750 tax credit.
The reclassification, part of President Joe Biden’s Inflation Reduction Act, tightens domestic sourcing requirements for battery parts and the raw materials used to build them. The number of EVs and plug-in hybrids that currently qualify for a credit is 18 models, down from 22 last year.
Stellantis’ operations in Italy were particularly hard hit last year, with vehicle production falling 37% compared to 2023, figures from the workers union show.
The FIM-CISL union said Stellantis last year manufactured 475,090 vehicles in Italy, down from 751,384 in 2023. Production of cars in particular shrank by 46% to the lowest since 1956, while output of new commercial vehicles fell 17%.
Like its European peers, the world's fourth-largest car maker is wrestling with weak demand, especially for fully electric vehicles, regulatory uncertainty and tough Chinese competition.
Tesla was not immune to the same issues other car manufacturers were facing, as the company reported annual vehicle sales dropped for the first time in more than a decade despite a year-end push that sent deliveries to a record in the fourth quarter.
The Elon Musk-led company sold 1.79 million vehicles last year, which was slightly less than it delivered in 2023, and also below analysts’ consensus estimate.
The results offer a sobering reminder of the real-world challenges for EV makers, even as hype around driverless cars and Mr Musk’s closeness with president-elect Donald Trump have sent Tesla’s stock soaring in recent months.
Lukewarm consumer demand is weighing on sales of electric cars, an issue that could be exacerbated by Mr Trump’s push to rein in EV incentives.
Tesla’s shares sank after the results, falling as much as 7.6% in New York. The stock rose 63% in 2024..
- Reporting by Bloomberg and Reuters