Honda (HMC, Financial) has sold approximately 13,000 units of its mid-size electric SUV, the Prologue, in a recent three-month period. While this is still behind Tesla's Model Y in market share, the Prologue has secured the fifth spot among electric vehicles in the U.S. This model is attracting drivers who have been waiting for a more affordable alternative to Tesla from a brand they trust. Two-thirds of current Honda SUV owners opt for another Honda, showcasing uncommon brand loyalty, which could challenge Tesla's dominance with the introduction of Honda's first electric vehicle.
The Prologue's allure lies in its classic practicality, with a starting price of $47,400, excluding incentives or premium options such as all-wheel drive. This price is only slightly below the average market value for all U.S. cars in September. Unlike many electric vehicles, the Prologue doesn't aim for sporty performance. Instead, it offers well-thought-out features, such as a large storage compartment under the center console, a panoramic sunroof, an oversized smartphone charging pad, and physical buttons and knobs, providing a user-friendly alternative to Tesla's touchscreen-centric design.
Distinct from most Hondas, the Prologue doesn't require traditional fuel or frequent configuration updates. According to the American Automobile Association (AAA), electric vehicles save nearly $1,000 annually in maintenance costs compared to gasoline-powered counterparts, requiring no oil or air filter changes. Honda, already a leading brand in reliability, is smartly integrating a more reliable new electric vehicle into its lineup.
Many Prologue buyers cite brand trust as their primary reason for choosing the vehicle, followed by its value. Notably, nearly two-thirds of these buyers previously owned a Honda, and around 80% had never owned an electric vehicle before.
Despite discussions of a slowdown in U.S. electric vehicle growth, third-quarter sales indicate significant demand for affordable alternatives and new models from established brands. According to Cox Automotive, U.S. consumers purchased 346,309 electric vehicles and trucks in the third quarter, marking a 5% increase from the previous quarter and an 11% rise year-over-year. Electric vehicles comprised 9% of new car sales, a record high, with the prospect of one in ten cars being electric considered attainable.
Tesla continues to lead with nearly 167,000 deliveries, including about 17,000 of its Cybertruck. However, as brands like Cadillac, Chevrolet, and Honda introduce more budget-friendly models, Tesla's market share has fallen below 50%. Chevrolet, in particular, has seen strong growth, with nearly 18,000 buyers for its Equinox and Blazer models this quarter. While the Prologue is more affordable than the average American car, these new Chevrolet models come at an even lower price point.
