The average price paid for a new electric vehicle in December 2023 was $50,798, down from a revised $52,362 in November and supported by incentive levels well above the industry average, according to figures released Jan. 10 from Cox Automotive.

In December, EV incentives reached their highest point of 2023 at 10.6% of ATP. A year ago, EV incentives were less than 2% of ATP.

Thanks mostly to significant price cuts from Tesla, average EV prices in December were down 17.7% from January 2023. EV sales in the U.S. reached a record 1.2 million units in 2023, up 46.3% from 2022, according to estimates by Kelley Blue Book.

“2023 was a milestone year with 1,189,051 pure battery electric vehicles sold, accounting for 7.6% of all new-vehicle sales,” said Stephanie Valdez Streaty, director of Industry Insights at Cox Automotive, in a news release. “Last year’s main story was Tesla price cuts that shook up the market and challenged the profitability picture for all automakers. Tesla is by far the dominant force in electric vehicles – when they cut prices, everyone takes notice.”