The electric vehicle market experienced a significant surge in July as consumers rushed to take advantage of a federal tax credit set to expire on September 30. According to a new analysis from Cox Automotive, both new and used EV sales saw a substantial boost last month.
Key Takeaways from July’s EV Market
– New EV sales increased by 26.4% from June and 19.7% year over year. A record 130,082 units were sold, marking the second-highest monthly total ever.
– Used EV sales were also up sharply, rising 23.2% month over month and 40.0% year over year, with 36,670 units sold.
– The federal tax credit, part of the 2022 Inflation Reduction Act, provides a credit of up to $7,500 for new clean vehicles and up to $4,000 for used clean vehicles under $25,000. This incentive is set to end after September 30, following the passage of President Donald Trump’s One Big Beautiful Bill Act.
New EV Sales and Pricing
July’s surge lifted the new EV market share to 9.1%. Many brands saw strong performance, with Volkswagen showing a remarkable 454% increase, placing it sixth in sales volume. The top five brands—Tesla, Chevrolet, Hyundai, Ford, and Honda—all posted strong gains. Luxury brands like Audi, Cadillac, and Mercedes-Benz also saw solid growth.
The average transaction price (ATP) for a new EV dropped to $55,689 in July, a 2.2% decrease from June. This narrowing price gap with traditional internal combustion engine (ICE) vehicles, combined with record-high incentives, made EVs more accessible. Incentives reached 17.5% of the ATP, or $9,768, on average.
Used EV Sales and Market Dynamics
The used EV market’s share of the overall used-vehicle market held at 2.2%. Tesla remained the dominant leader, accounting for 43.4% of all used EV sales. However, other brands like Chevrolet, Ford, and Nissan also saw strong sales. The largest month-over-month percentage increases came from Honda, Hyundai, and Rivian.
The average price for a used EV in July was $35,263, down 1.9% from June. This price drop, along with the expiring tax credit, helped narrow the price gap with used ICE vehicles to a record low of just $1,266. Several models, including the Chevrolet Bolt EV and various Tesla models, are now priced significantly below the market average, making them a more accessible option for budget-conscious buyers.
[source: Cox Automotive]
