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Hey everyone,
Quick heads up: Due to a technical hiccup, the newsletter we sent a few minutes ago was missing a few sections (including this intro and today's poll).
This version is the complete one.
Thanks for rolling with us.
— CDG
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Welcome to the Market Pulse—your cheatsheet to auto retail, built to help dealers price right, stock smart, and stay ahead.
New EV volume is down but stabilizing: 247,226 EVs sold in Q2, down 20.5% YoY. That's better than Q1's -27.3% and Q4's -36%.
Hybrid vehicle options are dominating: Hybrid sales are forecast up ~9% in 2026 even as the overall new-vehicle market shrinks 2.2%.
Tesla and Chevy are losing share, but Toyota just cracked the top five: Toyota's Q2 volume was up 8,187 units vs. last year, more than doubling.
(Source: Cox Automotive EV Market Monitor)
New EV sales are improving, even though they're still down 20.5% vs. last year.
Electric vehicle sales accounted for about 5.8% of total new-vehicle sales in Q2, down 20.5% from a year ago, the third straight quarterly decline.
Sourced via Cox Automotive
The good news: That gap is shrinking. Since the federal tax credit ended last fall, EV sales went from down 36%, to down 27.3%, to now down 20.5%.
Meaning, each quarter has posted a smaller drop than the one before it, and that things look worse on paper than they actually are right now.
NOTE TO DEALERS:
Sales are down 20.5%, sure, but that number reflects real buyers instead of tax-credit chasers, which means the demand you're seeing now is demand you can actually plan around.
What to do now: Build EV and hybrid inventory around what your local market demand is and don’t overcommit to any one segment.
The EV pecking order is shifting as OEMs regroup on product launches and timelines.
At the OEM level, some brands are genuinely winning right now, but a couple are getting hit hard.
Toyota, for one, added 8,187 EV units year over year, more than any other brand, and enough to crack the top five EV sellers in the country for the first time.
Subaru wasn't far behind, adding 3,653 units.
Both brands essentially doubled their EV volume from a year ago.
Kia, similarly, picked up another 2,309.
Custom CDG analysis of Cox Automotive data
On the other side: Tesla lost nearly 19,000 units, the biggest drop by far, even though it still makes up roughly half of all EV sales nationally. Chevrolet lost more than 13,500 units, with Nissan, Ford, Audi, and BMW all giving up volume as well.
WHY IT MATTERS:
Product cycles are under next-level stress right now, and brand-level performance will reflect it.
For dealers, that means sales teams need to be prepped daily on what's changed at the OEM level and what customers need to know most immediately.
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Given this week's edition, I called Stephanie Valdez Streaty, director of industry insights at Cox Automotive, to get past the headline numbers. I also pulled in a few tactics from Alex Lawrence, CEO and co-founder of EV Auto, who's been building a used-EV-only dealer group from the ground up.
Here are their dos and don’ts for dealers navigating EVs:
Do: Know the actual number that signals a real turnaround.
Asked what she'd call the North Star metric for judging whether the EV market has turned a corner, Streaty pointed to a specific stat.
"The North Star is really getting back past 8% share. Not sure if we'll get there this year because we're still kind of around 6%, but if we start to increase share quarter by quarter, I think that's going to be important."
Stephanie Valdez Streaty
Do: Sell the no-friction experience, not just the EV itself.
Lawrence, who's built his entire used-vehicle business around EVs, said trust comes from removing every point of friction from the deal, whether you’re moving gas models, hybrids, or full-blown EVs.
"We don't have any fees or add-ons… we don't require trades, we give out-the-door prices over the phone or via text within 30 seconds… we don't pressure you, you don't go to a F&I office, it's one person."
Alex Lawrence
Do: Understand that price, not range or charging, is still the real objection.
Streaty said the next leg of EV growth depends less on new technology and more on the industry finally closing the price gap with gas and hybrid equivalents.
"With EVs, right, the number one barrier is always price. There's still that price premium. So, I think the more we can have more compelling, affordable EVs for consumers as options, I think that's gonna continue to help."
Don’t: Let Chinese policy headlines distract you from what you actually control.
Polestar getting banned from the U.S. starting in 2027 is the kind of headline that opens a new can of worms. Even Lawrence, with an entire EV-only business, was straight about that when asked about the ban.
"I admittedly don't totally understand the depth and breadth of that decision,” he said.
Streaty's take: Stay engaged with what's unfolding at the policy level, but on a day-to-day basis with customers, focus on what your brand offers right now.
"Talk about [the] brand, franchise, their innovation, their expertise, their technology, and their vehicles, and focus on that."
The gas vs. EV debate feels a lot like the automatic vs. manual debate.
Everyone's got a side, and everyone thinks their preference is obviously right.
The solution isn't complicated, though. Drive what you prefer. Sell what you prefer. But whether it's gas, hybrid, or full EV, commit to it.
What I mean: Acquire said vehicles better than your competitor does. Know exactly why you're stocking them, more than you ever have. Have what your market actually wants, understand why they want it, and educate them on what it means for their situation.
