The U.S. electric vehicle market is showing tentative signs of stabilization after a prolonged downturn, according to research from Bernstein. Analysts at the investment firm said demand appears to be bottoming out, supported by improving inventory levels and early indications of renewed consumer interest.
Bernstein’s assessment follows a sharp pullback in EV sales and valuations over the past year, driven by rising interest rates, high vehicle prices and economic uncertainty. The firm noted that while the sector remains under pressure, recent data points suggest the worst may be over. Inventory levels have declined from peak levels seen in late 2023, easing concerns about oversupply.
The analysts also highlighted early signs of improving order backlogs at major automakers, though they cautioned that a full recovery is not yet assured. The U.S. EV market, which has been a key driver of growth for the broader automotive industry, continues to face headwinds from high borrowing costs and competition from lower-cost internal combustion engine vehicles.
Bernstein’s report comes as the Biden administration’s EV tax credits face scrutiny over their impact on domestic manufacturing and affordability. The credits, which have been a cornerstone of U.S. EV adoption efforts, are under review as part of broader fiscal policy discussions.
The firm’s outlook aligns with broader market expectations that the EV sector may be nearing a cyclical trough, though the pace and strength of any rebound remain uncertain.
