U.S. Will Continue to Lag Behind in Global EV Market

You could be forgiven for thinking electric cars are finally gaining momentum in the United States.

The world’s second-largest car market remains a laggard in electric vehicle adoption compared to much of the rest of the world. (Photo: Tesla X)

After all, sales of battery-powered vehicles topped 1.2 million last year — more than five times the number just four years earlier. Hybrid sales have also tripled, Natalie Sherman reported for BBC News.

Battery-powered cars accounted for 10% of overall sales in August — a new high, according to S&P Global Mobility.

And in updates to investors this week, General Motors, Ford, Tesla, and other automakers all reported record electric vehicle sales over the past three months. This marked a rare bright spot in an industry grappling with high interest rates and cautious consumers amid inflation, tariffs, and broader economic uncertainty.

But analysts say the surge was driven largely by a rush to buy before the end of a government subsidy that knocked as much as $7,500 (£5,588) off the price of certain battery-electric, plug-in hybrid, or fuel-cell vehicles.

With that tax credit ending in September, carmakers expect sales momentum to slow sharply. “It’s going to be a vibrant industry, but it’s going to be smaller — way smaller than we thought,” Ford Chief Executive Jim Farley said at a recent event.

“I expect that EV demand is going to drop off pretty precipitously,” General Motors Chief Financial Officer Paul Jacobson added at a conference last month, noting it may take time for demand to recover.

Even with recent gains, the U.S. — the world’s second-largest car market — remains a laggard in electric vehicle adoption compared to much of the rest of the world.