Automakers Extend EV Discounts Following Expiration of Federal Tax Credit

In response to the expiration of the $7,500 federal electric vehicle (EV) tax credit on September 30, 2025, General Motors (GM), Ford Motor Company, and Hyundai Motor Company have announced initiatives to maintain sales momentum by extending equivalent discounts on select EV models.

GM and Ford are offering the $7,500 discount through their leasing programs. GM Financial has secured approximately 30,000 EVs before the tax credit's expiration, enabling the company to lease these vehicles with the tax credit factored into the price. Similarly, Ford Credit is working with dealers to provide competitive lease payments on EVs until December 31, 2025.

Hyundai's approach includes direct rebates and price reductions. The company is offering a $7,500 cash rebate on the 2025 Ioniq 5 and reducing the price of the 2026 model by up to $9,800, depending on the trim level.

These measures come amid concerns about a potential decline in EV sales following the end of the federal subsidy. Ford CEO Jim Farley expressed apprehension, stating, "I wouldn’t be surprised if EV sales in the US go down to 5%" from about 10% currently.

The expiration of the tax credit is part of broader policy changes under the current administration, including increased tariffs on imported vehicles and components, which could add up to $5,500 to the cost of an imported vehicle.

Automakers are also adjusting their production strategies in response to these changes. Hyundai, for instance, is retooling its $5.5 billion plant in Savannah, Georgia, to manufacture both hybrids and EVs, allowing for more flexible production based on market demand.