Photograph by Jan Khür / Connected Archives
words by miranda green
If you were looking to buy an electric vehicle and take advantage of the federal tax break that offered car owners between $4,000 and $7,000 in savings, you are SOL.
As of October 1, the break offered through Biden’s Inflation Reduction Act has gone the way of the dodo.
Its demise won’t surprise anyone who’s been following the Trump administration’s systematic dismantling of clean energy programs and incentives. President Donald Trump’s first-day executive order, “Unleashing American Energy,” called for the “elimination of unfair subsidies” and froze a $5 billion program to establish charging stations in rural areas and disadvantaged communities. A federal court this summer ordered the funds to be restored after 14 states sued.
But the end of the EV rebate has highlighted an encouraging reality: It turns out that electric vehicles are more popular than Republicans have been giving them credit for.
In the final days of the rebate, purchases soared. Sales of EVs between July, August and September shot up 21% compared to last year, according to forecasts from tech company Cox Automotive, a 30% increase just from this spring.
Even without the tax breaks, data shows that EVs are here to stay. And the market is proving it.
Elaine Buckberg, a former General Motors economist now at Harvard University’s Salata Institute for Climate and Sustainability, told Bloomberg that she estimates 37% of new cars bought in 2030 will be electric. The reason? Electric cars are getting better, cheaper, and have more options to choose from.
“In the most likely scenario, you end up about two years behind on adoption,” Buckberg said of the impact of the rebate elimination. ”I think [EVs] will be more resilient than people are thinking.”
By all indications, electric vehicles have become commercial enough, economical enough, and—may I suggest—desirable enough that the future of ownership actually feels bright.
Everyone has a different cultural reference when they think back to the early days of clean energy cars. I have memories of stinky, vegetable-oil-guzzling hippie vans I saw traversing my hometown of Santa Barbara, California, and later the OG Prius hybrid hatchbacks my friend’s parents picked us up in after days spent at the beach. In short: They were not cool.
It was in college at George Washington University in 2011 that I got to drive the prototype of the Nissan Leaf, the first mass-market, all-electric vehicle offered in the United States. (I’ll never forget the shame I felt after I took the car out of the parking lot and promptly clipped a curb. All in the name of science, right?)
Later, Teslas helped change the image of electric vehicles from the car for the environmentalist to cars for anyone—well, those who could afford to shell out at least $98,000.
All of these early electric vehicles benefited from tax breaks approved by Democrats in Congress. Back in 2009, Congress passed a bill that offered $2,500 to $7,500 in tax rebates for the purchase of a new, qualified, plug-in EV. Originally, the program limited the credits to the first 200,000 qualifying plug-in EVs sold by each automaker; Tesla and GM were the first to hit the limit by 2019.
Republicans for years threatened to repeal the credits, but Biden actually helped expand the rebate through his 2022 Inflation Reduction Act and lifted the cap.
It would have kept the program going until 2032.
Despite the end to the rebate, there are many promising signs that EVs aren’t going anywhere.
● For one, charging stations expanded 19% just in the first nine months of this year—including a record number of new fast chargers—a growth attributed to companies working to meet the public’s increased demand.
● Brands like Waffle House, Cracker Barrel, and Target are boosting the technology by expanding fast-charging options in their parking lots, including in the deep south.
● Used electric cars are now selling faster than their gas counterparts, largely because they are cheaper. And it’s leading unlikely consumers to consider buying EVs for the first time.
●Internationally, countries are also doubling down on electric-vehicle investment. Last week, Germany’s chancellor agreed to offer €3 billion (nearly $3.5 billion) in EV purchase incentives. Italy’s incentives program starts this month. Other countries that offer big price cuts include Poland and Greece.
●At home, 17 states offer state tax incentives for EV purchases. Colorado recently upped its incentive, now offering car owners up to $9,000 to swap their gas vehicles for an EV lease or sale. The city of Burlington, Vermont, in September announced plans to double its EV rebate to $5,000.
Of course, it’s not all rosey. Some predict the EV market will take a big dip after the tax breaks end. A study in November 2024 from professors at the University of California, Berkeley and Duke University estimated that EV registrations could fall 27% without the tax credit.
Still, history offers an important precedent. The Obama administration was the first to make a big bet on electric cars with limited tax breaks, which were only meant to jump-start the tech before consumers took the lead. And it’s looking like that bet paid off. Electric cars are not fizzling out and consumers want to drive them—and for some, doing so is the cheaper option. We are living in an era where EVs are now interwoven in our collective futures and the technology will continue unabated, even without the White House’s help.
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EV Tax Breaks Ended—But the Future of Electric Car Ownership is Bright
