Auto experts make dire warning about US car industry as EV incentives dwindle: ‘The market is about to flip dramatically’

The electric vehicle market may face a bumpy road ahead, following the end of U.S. federal tax credits for new and used EVs last month.

What’s happening?

On Sept. 30, the $7,500 tax credit for new EVs and plug-in hybrids and the $4,000 credit for used ones expired. In a recent article, EnergySage took a look at what this could mean for the EV market. An objective, independent expert on all things solar, EnergySage helps consumers discover the right solar systems for their homes with its free, easy-to-compare quotes.

“The market is about to flip dramatically. … Expect a very different landscape,” EnergySage wrote prior to the Sept. 30 deadline, citing several auto experts, including General Motors North America senior vice president Duncan Aldred.

“There’s no doubt we’ll see lower EV sales next quarter after tax credits end September 30, and it may take several months for the market to normalize,” Aldred said in a statement. “We will almost certainly see a smaller EV market for a while, and we won’t overproduce.”

Why is this important?

The electric vehicle boom has benefited consumers in numerous ways. For one, drivers don’t have to worry about paying high gas prices or shelling out money for oil changes. All in all, EV owners can save around $1,500 per year on fuel and maintenance.

Increased EV adoption has also contributed to cleaner, healthier communities, as EVs don’t produce tailpipe emissions linked to childhood asthma, heart disease, and other complications.

Installing solar panels enables drivers to enhance these perks. Charging with a home solar system is significantly cheaper than relying on public charging stations or the grid, and photovoltaic panels don’t release any planet-warming emissions when operating.

EnergySage helps the average household save $10,000 on solar installation by mapping available incentives in each state. Acting now could net you thousands in long-term savings with federal solar credits expiring Dec. 31.

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What do changes to EV credits mean for consumers?

Despite the earlier-than-expected conclusion of EV tax credits, Aldred remains optimistic that investing in EV technology will still be worth it. “We believe GM can continue to grow EV market share,” Aldred said, per EnergySage. Recently, GM also announced a partnership with Pilot to bring more EV charging stations to rural areas and support coast-to-coast travel.

Meanwhile, drivers who want an EV may still be able to snag one at a favorable price point. Ivan Drury, director of insights at car buying website Edmunds, suggested to CNN that manufacturers may start to lower prices, introduce better financing, or offer cash-back deals to move inventory.

“If you already can’t sell the vehicles at current prices, there’s no way you are going to sell them at today’s prices with this credit going by the wayside,” Drury said as the deadline loomed.

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