The EV Tax Credit Is Dead. Here's 5 Predictions For What Happens Next

"At midnight on Tuesday, the long-running clean-vehicle tax credit bit the dust. It was one of the last vestiges of federal support for the electric car industry in the Trump era and a key driver of transportation electrification in this country. For proof of the latter, just look at what happened over the last few months as car buyers scrambled to get $7,500 off of an electric vehicle for potentially the last time ever."

"From the beginning of July (when Republicans' sweeping budget bill formalized the tax credit's demise) through the end of September (the policy's new expiration date), Americans snapped up a record 410,000 new EVs, Cox Automotive estimates. But what happens next? What does the post-subsidy EV era look like? I asked industry experts what they think. They agreed that this was bad news for EV fans this year, but that it's too late to stop the inevitable EV revolution."

"A hangover is coming after Q3's EV party, analysts said. Partly because so many people pulled forward their EV purchases to snag a tax credit, the next couple of quarters may see a sharp drop in demand. It's going to be a choppy period of time ahead, said Aleksandra O'Donovan, head of electrified transport at the research firm BloombergNEF. After a roughly 30% gain in Q3, BNEF expects plug-in vehicle sales to plummet by 24% year-on-year in Q4."

The federal clean-vehicle tax credit expired at midnight Tuesday, removing a major subsidy for electric vehicle purchases. From July through September, buyers rushed to claim up to $7,500, driving an estimated 410,000 new EV sales. A significant pull-forward of demand is expected to cause a sharp sales decline in the coming quarters, with BloombergNEF predicting a roughly 24% year-on-year drop in Q4 after a 30% Q3 gain and flat 2026 share versus 2025. Automakers are preparing for a noisy recalibration period in October and November and anticipate a near-term demand slide. Long-term electrification momentum remains intact despite the short-term disruption.

Read at insideevs.com