On the Road to Reach Our Goals: NJ Sees Strong Year for EV Sales
Highland Park, NJ – The electric vehicle (EV) registration numbers are in and they are encouraging: The state saw 56% growth in a year; with EV registrations increasing from 41,097 in 2020, to 64,307 at the end of 2021. Of the 64,307 EVs on the road, 46,053 are battery electric vehicles (BEVs) and 17,854 Plug-In Hybrid electric vehicles (PHEVs), confirming that BEVs continue to dominate the market given rapid advancements in battery technology. The sales results are as remarkable as registration numbers, with 25,992 EVs sold in New Jersey in 2021, compared with 13,797 sold in 2020, representing 88.4% year to year growth in EV sales.
Today just over 1% of all the light duty vehicles (LDVs) on the road in New Jersey are now electrified. “It took just under nine years to sell the first 30,000 EVs in NJ, and well under two years (2020 and 2021) to sell the next 30,000 EVs,” says Mark Warner, VP of Gabel Associates. These accelerated results certainly demonstrate that the NJ market is progressing in the right direction, despite the pandemic and the global supply chain challenges that will persist for some time given the war in Ukraine. “If the growth demonstrated in 2021 is sustained, the next 30,000 EVs sold in NJ will happen in well under a year,” Warner continues.
Despite this encouraging news, we need to be clear eyed about what it will take to continue fostering the momentum required to reach our state goal of 330,000 registered EVs by 2025. The current forecast requires an average year-to-year sales growth of 53%, which must be sustained over the next three years. The numbers show us that this is achievable given the growth rate of the past few years, especially demonstrated in 2021. However, these strong results point to the start of the NJ Charge-Up Rebate program. This means, as ChargEVC projects, that we will need a stronger rebate program to get at least 39,000 new EVs on the road in 2022 (compared with 26,000 in 2021) to sustain growth and stay on track to hit our target. “New Jersey is at a pivotal point in the market transition. Now, more than ever, the State must take a proactive approach to continue to cultivate a robust financial and regulatory environment that supports strong EV expansion,” says Pam Frank, CEO of ChargEVC.
Sustaining over 50% sales growth means funding for more rebates will be needed this year and over the next several years. Not all EVs on the road will receive rebates from NJ’s Charge Up Rebate program, nor should they. To have a shot at reaching our goals, however, requires sending a strong message to manufacturers to put their limited inventory into the New Jersey market. This message is loud and clear when coupled with an appropriate level of rebate funding, tied to reaching our goals.
Analysis informs that approximately $100M is necessary for EV rebates for this program year, which begins in the new fiscal year. Some might balk at this figure, but the plain fact is that there is nothing more impactful when it comes to reducing health and climate impacting emissions than expediting the transition to electrification of our light duty vehicles. The rebate program has appropriate guard rails so that the state is not providing rebates for high end luxury vehicles. However, EVs still cost more than the traditional equivalent internal combustion engine vehicles so this support is needed given the aggressive sales growth we need to sustain. Keep in mind that we won’t need these levels of support long term as those costs are coming down in an accelerated fashion as the market continues to mature. Like all emerging markets, early adoption typically requires upfront financial impetus and incentive to drive change.
EVs offer significant benefits, such as greenhouse gas reductions, and supports New Jersey’s transition to sustainability and a clean, green economy. As we look west to California, where New Jersey is one of many states that have adopted California’s Clean Car Rules, California is signaling even faster and aggressive growth with proposed standards under the Advanced Clean Cars II Program. This would require about 35% of vehicles sold by manufacturers to be EVs starting in model year (MY) 2026 and moving towards 100% sales of EVs in MY 2035. New Jersey should follow this lead.
The direction is clearly do more, and faster. Now is the time for New Jersey to shift into high gear to demonstrate its national leadership. Let’s work to get New Jersey to the head of the pack!
Contact: Pam Frank, CEO, ChargEVC-NJ
Email: pam@gabelassociates.com
Phone: 609-577-2795
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ChargEVC-NJ is a not-for-profit coalition of diverse stakeholders that includes retail automotive dealers, utilities, consumer and equity advocates, environmental and labor organizations and technology companies. See www.chargevc.org for more information.