Anything but Tesla: US shoppers want more EV options

• EV shoppers want more choices than Tesla.
• Recent EV survey results could spell trouble for Tesla's growth.

Electric-vehicle shoppers are getting sick of Tesla.

Well over half of the EV shoppers surveyed by UBS in an annual study said they would prefer to buy an electric car from a legacy carmaker over a new manufacturer such as Tesla.

On top of that, the bank found that the likelihood a US shopper would buy an EV increased with brands other than Tesla.

These results and other signs of stagnation overall in the EV market give UBS reason to believe that Tesla's near- to midterm growth plans are in danger.

UBS has a lower-than-average delivery forecast for Elon Musk's automaker, predicting sales of 1.8 million this year and about 2 million in 2025. That's compared with the current consensus among analysts of deliveries just below 2 million this year and about 2.4 million in 2025.

Despite EV shoppers' clear desire for more options, Tesla remains the top brand for consideration and saw an increase in preference among American shoppers, the survey said.

Joseph Spak, a UBS analyst, attributed this growth to recent floundering EV efforts from legacy brands in the US, given that BYD managed to surpass Tesla in preference among Chinese respondents.

The latest sign of trouble for Tesla

It appears that a slowdown in EV demand that has dogged Musk's opponents since last year is finally catching up to Tesla.

The electric-vehicle maker last week reported its lowest quarterly results since 2022 and the company's first year-over-year quarterly decline since 2020.

So far, an aggressive price-slashing campaign made possible by Tesla's hefty profit margins has been enough for Tesla to keep up with a changing demographic of EV shoppers who are becoming increasingly frugal and practical in their purchases.

If EV demand continues to soften, however, simply lowering prices may not be enough. This next wave of EV shoppers is also placing more importance on maintenance costs and comparing electric cars against hybrids and gas-powered cars.

A growing interest in hybrid vehicles, which Tesla doesn't sell, may pose another threat.

A recent study from Boston Consulting Group forecast that the growing hybrid interest was likely to peak among mass-market and premium sedans, coupes, and crossovers — Tesla's bread and butter.