Electric vehicle sales for 1Q and March are in for several companies, including Chinese carmakers Nio (NIO) and XPeng (XPEV).

However, the current energy crisis around the world as gas prices spike due to the Iran war underscores the usefulness of vehicles that can run on electricity. Used EV sales have reportedly spiked in the EU since the conflict began, perhaps preluding a greater shift in buying habits. Investors should watch the next few quarters to see if there’s any spikes in sales and where they’re coming from.

Nio delivered 35,486 vehicles in March, a +136% year-over-year jump. In the first quarter, it delivered 83,465, +98.3%.

On the other hand, XPeng delivered 27,415 vehicles in March (-17%) – marking the third straight month of year-over-year declines — and 62,682 for 1Q (-33%). It also officially entered the Mexican market in March as part of a three-year strategy to sell in Latin America.

Reuters believes Tesla’s (TSLA) 1Q deliveries will be lower year-over-year due to competition and uneven demand as EVs have struggled in the U.S. It is estimated to report between 365,000-366,000 vehicles tomorrow, putting it roughly level with Nio’s production.

Still, Reuters reports that new registrations of Tesla’s tripled in March in France, and there are other signs of life in the European market. Notably, this is a bounce back from 2025, where it lost about half of its market share in Europe – often to Chinese alternatives.

Global adoption of electric vehicles is happening in stages, driven both by costs and by politics. The removal of the EV tax credit in the U.S. caused a dip in new sales, but markets abroad may have more interest. Also note that many of these EV companies are also working on self-driving and other robotic initiatives, much like Tesla.

The U.S. may simply be falling behind on the electrification race. China is the largest market for EVs, making up around 60% of the total market and close to reaching an EV share of 50% on its roads. A group of European countries, including Norway and Finland, are the next-fastest adopters. Meanwhile, legacy American carmakers have pulled back on their EV programs, often after significant investments, because of the lack of consumer adoption.

What does this mean overall? Despite pessimism in U.S. markets, the EV trade is alive and well, and looking to take the next steps. The more vehicles on the road, the more data these carmakers will have, and the better they’ll be able to develop more complex products like automated driving. Tesla will find itself with some tough competition over the next few years; we’ll see where the arms race goes next.

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