By Kalea Hall
Oct 8 (Reuters) – US car shoppers have been slow to warm back up to electric vehicles since a key federal subsidy expired a year ago, despite persistently high gas prices, while Europeans have flocked to the cars.
EV sales in the US are down 30.7% this year through September, according to research firm Motor Intelligence, accounting for just 6% of overall sales. That’s less than the 8.5% at this time a year ago, when buyers rushed to beat the expiration of a $7,500 federal tax credit.
In Europe, however, buyers have flocked to electrics for relief from higher fuel prices stemming from the war in Iran. EVs accounted for 23.2% of the European auto market this year through September, up from 17.7% a year earlier, according to the European Automobile Manufacturers’ Association.
The divergence in the two markets is due in part to key policy differences between the two regions. In Europe, automakers continue to roll out electric models to meet stringent tailpipe-emissions regulations, and Chinese automakers have stormed the European market with a slew of imported EVs.
In the US, the Trump administration worked with Congress to eliminate support for EVs, and watered down fuel-efficiency regulations. High tariffs and a ban on Chinese-made vehicle software have effectively blocked Chinese car brands.
Meanwhile, there were more than 150 EVs on sale in Europe during the first half of 2026, up from about 100 models in 2024, according to Transport & Environment, a Brussels-based environmental advocacy group. Many are priced below 25,000 euros ($27,995), and many countries offer tax breaks to lower consumers’ out-of-pocket costs.
US BUYERS GO FOR HYBRIDS, USED EVS
Since the expiration of the $7,500 federal tax credit a year ago, many US automakers have discontinued electric models or scrapped plans for new entries. Some have done away with cheap leases that helped fuel demand.
Buyers instead are seeking hybrids and used EVs, car dealers and analysts say. Hybrid sales jumped 23% through the first three quarters from the year-earlier period, accounting for 15.6% of total sales over that stretch.
“There’s still demand out there [for EVs], but the energy and the masses are definitely running to hybrid technology,” said Thad Szott, a Detroit-area dealer with Ford, Stellantis and Toyota.
Some automakers are adding hybrids to their showrooms. Nissan, for example, moved up the launch of a new hybrid system on its popular Rogue SUV by several months.
Hybrids are “a safer choice” for consumers worried about driving range, said Tiago Castro, Nissan’s senior vice president of US marketing and sales. “When we had the government incentive” for EVs, he said, “it was a different story.”
The market for used EVs is bustling, though, a sign that less affluent buyers are seeking relief from high fuel prices. Sales of used electric cars rose 19% through September from the year-earlier period, according to research site CarGurus.
TESLA, RIVIAN EVS FARE BETTER THAN LEGACY CARMAKERS
EV-only brands have fared better than traditional automakers’ EV sales. Tesla’s US sales fell only 14% in the first three quarters, a milder decline than the broader electric vehicle market, according to an estimate from Motor Intelligence. Rivian’s US sales rose 29%, helped by the release of a new SUV, the R2.
By contrast, Ford’s EV sales are down 68% this year through September, while crosstown rival General Motors saw a 43% drop in EV sales.
Honda has opted to end production of its EVs after this year, while planning to expand hybrid sales. “Once they scaled back the $7,500, it became obvious” that EV market share would decline, said Lance Woelfer, vice president of US auto sales at Honda.
However, South Korean automaker Hyundai has seen some recovery in EV sales since gas prices began rising in late winter, and dealers are asking for them, said Randy Parker, CEO of Hyundai Motor North America.
“We’re not giving up on EVs by any stretch of the imagination,” Parker said.
(1 euro = $1.1197)
(Reporting by Kalea Hall in Detroit and Nick Carey in London; Editing by Mike Colias and David Gaffen)
Comments