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Demand for Alternative Fuel Vehicles Dwindling

April 27, 2016

MCLEAN, Va. — Of the 17.5 million vehicles sold last year, less than 500,000 were alternative fuel vehicles. According to the NADA Used Car Guide, that statistic wasn’t an outlier; the demand for alternative-fuel vehicles has been dwindling for years.  

The report noted that while alternative-fuel vehicles have been widely available for years and offer consumers improved fuel efficiency, consumers have still been hesitant or unwilling to forego the familiarity of gas and diesel vehicles. Over the past few years, according to the firm, the amount of gas-powered vehicles being traded in for hybrid vehicles has decreased.

"Looking at the past three calendar years, a whopping 47.7 million gasoline- and diesel-powered vehicles were sold in the United States, representing 96.6% of total sales over that period,” said Jonathan Banks, NADA Used Car Guide’s executive analyst.

From 2013 to 2015, the percentage of alternative fuel vehicles comprising the automotive market has dropped from 3.8% in 2013 to 2.8% in 2015, with a majority of consumers opting for hybrids, according to the firm. Over the last three years, hybrids accounted for 79.8% of the alternative powertrain market with 1.32 million hybrid deliveries.

However, hybrids as a percentage of all alternative powertrain sales have decreased from 83.2% of the market in 2013 to 76.7% in 2015, according to the company.

Electric vehicles follow hybrids in terms of popularity in the market. But unlike hybrids, which have experienced a reduction in deliveries over the past three years, electric vehicles have seen a nearly 50% increase in deliveries in that time. However, the segment's market share still remains low. Last year, electric vehicles accounted for 14.4% of all alternative powertrain sales, a 6.3% increase over 2013.

Although overall alternative fuel market share is low, the report did find one boon for the segments: alternative fuel loyalty. The report found that the amount of customers trading in their plug-ins and EVs for newer plug-ins and EVs has grown.

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