How the United States stayed in the worldwide race with electric cars

It may be forgiven that you think that electric cars can finally pick up speed in the United States.

In the end, battery sales exceeded 1.2 million last year, more than five times more than just four years earlier. Hybrid sales have jumped with factor three.

Battery cars represent 10% of total sales in August – a new peak, according to S&P Global Mobility.

And in investor updates this week, General Motors, Ford, Tesla and other companies have reported record sales of electric over the last three months.

This marks a bright place in the branch fight against falling from still high interest rates and buyers of advantage over inflation, tariffs and wider economy.

But analysts say the boom is caused by a dash to buy before the end of the government subsidy, which helped to knock down to $ 7,500 (5,588 British pounds) from the price of certain electrical batteries, plugins hybrid or fuel cells.

With this tax credit from the end of September, car manufacturers expect the momentum to transfer to the reverse country.

“This will be a vital industry, but it will be less, much smaller than we thought,” said Ford CEO Jim Farley at an event on Tuesday.

“I expect the search for EV to be dropped quite quickly,” said General Motors Chief Finance Officer Paul Jacobson at a conference last month and added that it would take time to see how quickly buyers would return.

Even with the latest profits, the US, the second largest car market in the world, stood out as a lag in sales of electric cars compared to much of the rest of the world.

In the UK, for example, sales of electric and hybrid cars of the battery make up nearly 30% of new sales last year, according to the International Energy Agency (IEA), while in Europe they represent approximately one in five sales.

In China, the largest car market in the world, sales of such cars represent almost half of the total sales last year, according to IEA, and are expected to become a majority this year.

Taking into some other countries, such as Norway and Nepal, is even greater.

Electric vehicles (EVS) tend to take into account a smaller share of sales in Latin America, Africa and other parts of Asia – but growth there is increasing.

Analysts claim that adoption to the United States is delayed by relatively weak state support for the sector, which limits types of subsidies, trade programs and rules that have helped industry in places such as China, the United Kingdom and Europe.

Former President Joe Biden pressed to increase hard, purposefully For electric cars to represent half of all sales in the United States by 2030.

His administration has tightened the rules for emissions, strengthened the demand by purchases of government fleeting parks, prompted car manufacturers to invest with EV investment loans and grants, spent billions, building fees for fees and expanding the $ 7,500 tax loan as a sweetener for buyers.

Proponents put these efforts in part as a competitive imperative, warning that without these American car manufacturers, they would risk losing from competitors from China and other countries.

But President Donald Trump, who recently called the climate change “construction”, demanded that he eliminates many of these measures, including $ 7500 loan, arguing that they are pushing people to buy cars they would not otherwise want.

“We say … you won’t be forced to do all these cars,” he said this summer as he signed a bill targeted at the impact California rules that would have Gradually executing car sales only for gasoline In the state by 2035 “You can do them, but it will be on the market tried by the market.”

Electric cars have become more accessible in the United States in recent years – but still cost more than comparable gasoline vehicles.

And Chinese car manufacturers such as BYD, which made quick attacks in other markets thanks to the low prices, were effectively excluded from the United States due to high rates aimed at cars made in China, supported by both Biden and Trump.

As of August, the average price of an electric car transaction in the United States was over $ 57,000, according to the Kelley Blue Book research industry company, with about 16% higher than the average for all cars.

The least expensive battery car, which is available, Nissan Leaf, costs about $ 30,000 (22,000 British pounds). For comparison, several models can be found for less than £ 20,000 in the UK.

Analysts say that what buyers do the next dependent on how car manufacturers determine prices in the coming months, as they fight not only with the end of the tax credit, but also at the rates for foreign cars and some parts of the car that Trump presented this spring.

Hyundai said it would compensate for the loss of tax credit this week by reducing the cost of Ioniq EVS. But Tesla said the cost of monthly leasing payments of some of its cars would increase.

Stephanie Brinley, an associate director of S&P Global Mobility, said he did not expect many companies to follow the Hyundai example, given the pressure from the tariffs.

While some buyers can choose EVS anyway, “next year will be difficult,” she warned, noting that her company calls on the total sales of cars to fall by approximately 2% in 2026.

“It would be difficult enough if everything you had to deal with are new tariffs, but with new tariffs and the stimulus is leaving, there are two effects.”

Car manufacturers have already scaled their investments in electric cars.

Researchers say changes to Trump’s policy can reduce these investments even more.

“This is a big hit for the EV industry – there is no finger tip around it,” says Catherine Juscoa, an analyst of research in the American Security Project

“Subsidies were initially a way of equalizing the game conditions and now that they do not have, the United States has many reason to compensate.”

However, G -Ja Brinley said it hesitated to announce the United States in an industry that still tests technological alternatives.

“Is it really (electric) really?” she said. “Telling that we are behind us suggests that this is the only and best solution and I think it’s a little early to say that.”