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EV Tax Credit Expiry Sparks Sales Slump
1 Jan
Summary
- EV sales surged in Q3 2025 due to a $7,500 tax credit deadline.
- US EV market share dropped significantly after the credit expired.
- Analysts predict a substantial decline in Q4 2025 Tesla deliveries.
The electric vehicle sector is experiencing a pronounced sales slowdown following the expiration of the $7,500 federal clean vehicle tax credit. In Q3 2025, a rush of buyers seeking to secure the incentive before its September 30 deadline propelled record delivery numbers for many automakers, including Tesla.
However, this surge proved temporary. Data from October and November 2025 revealed a stark reversal, with U.S. EV market share plummeting from over 11% in September to approximately 6% of new-vehicle transactions. This indicates a significant pullback in consumer demand post-incentive.
Tesla, which achieved a record of approximately 497,000 deliveries in Q3 2025, now faces analyst projections of a 14% to 19% sequential decline in Q4. These forecasts, ranging from 405,000 to 455,000 units, suggest a potential year-over-year decrease and highlight underlying challenges in the EV market.
