EV Sales Plunge: A Predicted Collapse Unfolding in the US

EV Sales Plummet Following Tax Credit Expiration

In October, electric vehicle (EV) sales in the US took a sharp turn, plunging to around 5% of the total market share, according to estimates from J.D. Power and S&P Global Mobility. This significant drop follows Ford's CEO, Jim Farley's prediction that the market share of EVs would be halved once the federal tax credit for clean vehicles came to an end on September 30.

The tax credit, which offered up to $7,500 to buyers of new EVs, had a substantial impact on sales, with Americans rushing to purchase or lease nearly 150,000 EVs in September, taking advantage of the incentive before it expired. The decline in sales is even more evident when comparing October 2022's EV sales to the same period last year, where over 8% of vehicles sold were electric.

Plug-in hybrids also suffered a considerable blow, with their market share dropping from 2.2% in September to just 1% in October.

The Lasting Impact of the Tax Credit Expiration

The expiration of the federal tax credit has left a noticeable void in the EV market. According to S&P Global Mobility, approximately 64,000 new electric vehicles were sold in October, marking a considerable decrease from the previous month's sales.

This decline brings back memories of early 2022 when EVs accounted for only 5% of US vehicle sales. The sudden drop in sales following the tax credit's expiration raises questions about the incentive's role in driving EV adoption and whether the market can maintain its growth without similar financial incentives.