Last-Minute Surge in EV Sales as Federal Tax Credit Nears Expiration
Last-Minute Surge in EV Sales as Federal Tax Credit Nears Expiration
A significant federal tax credit for electric vehicles (EVs) is set to expire this Tuesday, triggering a frantic last-minute buying spree across the nation, with Southern California experiencing a notable spike in demand. Consumers are flocking to dealerships and auto shows to secure incentives offering up to $7,500 off new EVs and $4,000 off used models before the benefit, tied to a new Trump administration policy, concludes.
The rush to purchase has led to a substantial increase in sales figures. The Orange County Automobile Dealers Assn. reported that all-electric vehicle sales in Orange County surged from 21% in May to 32% in July following the announcement of the credit’s impending end. Nationally, new EV sales jumped 19% in July year-over-year, and J.D. Power predicts a record 12% share of car sales for EVs this month. Dealerships, such as Cadillac of Beverly Hills, are seeing electric models comprise approximately two-thirds of their new vehicle sales, with product specialists confirming the expiring credit as a primary motivator for current buyers.
Despite the current boom, industry analysts are cautioning about a potential downturn. Thomas King, president of J.D. Power’s data and analytics division, forecasts a considerable drop in EV sales for October. This anticipated decline reflects both the direct impact of the federal tax credit’s expiration and the market’s adjustment after a summer of accelerated purchases. The changing landscape is already influencing consumer decisions, with some prospective buyers, like Long Beach retirees Stacey and Jim Palma, reconsidering EV purchases and instead looking towards more affordable hybrid options as financial incentives disappear.
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