The San Francisco Bay Area has reached a significant milestone in the widespread adoption of electrified vehicles, becoming the first region in the United States where electric and hybrid vehicles account for over 50 percent of new car sales.
According to recent research conducted by S&P Global, the San Francisco “Designated Market Area” (DMA) achieved this groundbreaking sales figure in March, and the trend continued in April with electrified vehicles comprising 53.1 percent of new vehicle purchases.
The success of electrified vehicles in the region can be attributed to two primary factors. Firstly, the demographic composition of San Francisco aligns remarkably well with the profile of electrified vehicle buyers. The city boasts a relatively younger population compared to other areas, and its residents tend to have higher levels of affluence. Notably, 46 percent of San Francisco residents have a household income exceeding $200,000, whereas 40 percent of electric vehicle buyers nationwide share the same income bracket.
It is important to note that the concentration of electrified vehicle buyers is not limited solely to the city of San Francisco but extends to neighboring enclaves such as Los Altos, Saratoga, and Piedmont, among others. Interestingly, San Ramon, the location of Chevron’s global headquarters, exhibits the highest penetration of electric vehicles within the DMA.
While hybrid vehicles contribute significantly to the success of electrified vehicles in the region, purely electric vehicles enjoy even greater popularity compared to the national average. In March, electric vehicles accounted for 34.3 percent of sales, surpassing the national average by more than four times.
Unsurprisingly, Tesla remains highly popular in the San Francisco Bay Area. Approximately one in four new vehicle sales in the DMA, regardless of powertrain type, can be attributed to the pioneering electric vehicle manufacturer, which owes much of its success to California.
However, Tesla is not the only automaker experiencing remarkable success in the region. For instance, sales of the VW ID.4 were four times higher in the San Francisco Bay Area compared to the rest of the country in March.
While the success of electrified vehicles in San Francisco is undoubtedly encouraging for the technology, it does highlight the fact that these vehicles are still predominantly purchased by affluent individuals. Although increasing competition and tax incentives may contribute to promoting more affordable options in the future, this economic disparity is likely to remain a challenge for the rest of the United States in the near term.
