agent Entrepreneur logo
MenuMENU
SearchSEARCH

EV Tax Credits on Chopping Block

Meanwhile, plentiful supply creates sales opportunities.

May 13, 2025
EV Tax Credits on Chopping Block

Some of the first-quarter EV sales surge came in consumers getting ahead of any trade tariff push on vehicle prices.

Credit:

Pexels/Tom Fisk

2 min to read


As the Trump administration and congressional Republicans target electric-vehicle subsidies, consumers have a potentially fading chance to  get deals, just as EV prices have come in line with gas-powered models.

House Republicans proposed this week to eliminate tax credits of up to $7,500 for EV purchases that have boosted sales of electrified vehicles and put EV transaction prices on par with those for internal combustion engine vehicles.

Ad Loading...

Combined with axing incentives for clean-energy production, the tax credit tanking would go toward the Trump administration’s tax-cut package.

With the EV tax credits still in place, the average transaction price for EVs is now $45,600, just $500 more than for ICE vehicles, according to J.D. Power research.

The House GOP proposal would phase out the EV tax credits, ending them completely by the end of next year. At that point, the average EV ATP would tick back up to $51,200, J.D. Power said.

The figures don’t take into account any inflation related to U.S. trade tariffs, which are still very much in flux.

Meanwhile, consumers can take advantage of plentiful EV inventory on dealer lots, which totaled about 155,000 new units this month, according to J.D. Power. It pointed out that the existing inventory also isn’t subject to tariffs because it was already in place before they took effect.

Ad Loading...

Automakers have introduced more EV models to answer regulatory pressures, bringing the number available on the U.S. market to more than 60, J.D. Power said. With the broad selection and lower ATPs, market share jumped 18% year-over-year in the first quarter, most of it from mass-market consumers.

Some of the first-quarter EV sales surge came in consumers getting ahead of any trade tariff push on vehicle prices.

If the EV purchase tax credits indeed end, it’s unknown if the cost difference will be passed along to consumers and how the change will affect EV sales.

LEARN MORE: Chevy Is Electrified

Originally posted on F&I and Showroom

More Industry

Group photo of men outside storefront.
Industryby Hannah MitchellMay 28, 2026

Pennsylvania Dealership Under New Retailers

The sale of the Chrysler Dodge Jeep Ram store puts a family auto group on a leaner path as first-time dealers take the helm.

Read More →
Hallway with lockered wiring and computer
Industryby Lauren LawrenceMay 28, 2026

Battery Storage Takes Priority Over EVs

U.S. automakers are prioritizing battery energy stationary storage over electric-vehicle production as the consumer demand for EVs lags the rest of the world.

Read More →
Gray-scale photo of a line of Mini cars in a dealership parking lot
Industryby Hannah MitchellMay 27, 2026

Auto Dealers Feel Better But Not Great

A second-quarter Cox Automotive poll of franchised retailers and independents found better views of the current market after a good spring but anticipation of third-quarter storminess.

Read More →
Ad Loading...
Closeup photo of the front of a white car
Industryby Hannah MitchellMay 21, 2026

New-Vehicle Sales Picture Relative

A May forecast is complicated by last spring’s trade tariff effects on auto retail. Despite continued hard realities, many consumers took advantage of ways to bite the bullet.

Read More →
Nissan logo on front of building
Industryby Lauren LawrenceMay 21, 2026

Auto Group Acquires Third Nissan Rooftop

Iowa-based Coleman Automotive Group recently acquired its seventh dealership, McGrath Nissan, which it renamed Nissan of Elgin.

Read More →
Couple talking with auto salesman next to new car inside dealership
Industryby Hannah MitchellMay 20, 2026

April Less Affordable

Based on prices, reduced incentives and slower household income growth, consumers found it more challenging to buy new last month, Cox Automotive reported.

Read More →
Ad Loading...
Wooden people figures of different colors in a row, similar to board game pieces
IndustryMay 20, 2026

Building an Extraordinary F&I Agency

Work to determine your specialized talent, because that fact will determine everything about your agency’s future.

Read More →
Ingredient card, policies and procedures, fixed operations, variable operations, data security, audit
Industryby Jim GantherMay 19, 2026

Recipe for Compliance

The secret to both amazing barbecue and compliance is the same: understanding the basics and committing to a process.

Read More →
Photo of new Chevrolet Bolt parked on a beach
Industryby Hannah MitchellMay 14, 2026

EVs Getting More Attractive

A growing percentage of U.S. consumers are open to switching and fewer are adverse to the idea, according to a recently completed survey. That’s despite the end of a tax break.

Read More →
Ad Loading...
Benchmark bar graph showing April 2026 EV Sales
Industryby Lauren LawrenceMay 14, 2026

EV Sales Drop in April Following Surge

North American electric-vehicle sales were down 28% year-over-year, a sharp contrast from global EV sales growth of 6%.

Read More →