U.S. EV sales could spike, then collapse, as subsidies vanish
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Second-quarter EV sales fell 6.3% compared to April-June of 2024, and the road ahead looks jarring with the loss of consumer purchase subsidies looming, per new Cox Automotive data.
Why it matters: While sales set a record in 2024, and the first half of 2025 narrowly did, too, the upward march was getting less consistent even before the GOP's new budget law nixed incentives.
Catch up quick: Tax incentives up to $7,500 for buying new EVs will end on Sept. 30 under the giant GOP budget bill that President Trump signed earlier this month.
- It quickly ends smaller subsidies for used EVs and credits for commercial EVs.
- Leasing incentives are also ending.
What's next: Cox analyst Stephanie Valdez Streaty, in a statement alongside the data, predicts a "rush ahead of the federal incentive phase-out, offering a short-term boost in an otherwise uncertain landscape."
- "Q3 will likely be a record, followed by a collapse in Q4, as the electric vehicle market adjusts to its new reality," she said.
State of play: The picture varies by automaker. GM sold over 78,000 EVs in the first half of 2025, more than twice the same stretch last year.
- Meanwhile, "Tesla's sales fell by more than 12% year over year in Q2, following a decline of nearly 9% in Q1," Cox notes.
What we're watching: The loss of credits isn't the only budget law provision that could affect EV sales.
- A new post on the law's impact from Columbia University's energy think tank flags new auto loan interest deductions — with income limits — for U.S.-assembled vehicles.
- "The deduction allowance largely benefits the early purchasing of lower-cost domestic gas cars, again increasing the incentive for consumers to switch away from EVs," it states.
Note: Cox Automotive's parent company, Cox Enterprises, also owns Axios.
