How bad do we want buyers? We are about to discover

Detroit – Car manufacturers and investors are about to discover what is “natural demand” for new electric vehicles in the United States, from this week.

In the midst of what should be a record year for VE sales, including a record for units sold in the third quarter, EV demand should decrease. Indeed, federal incentives up to $ 7,500 to buy a rechargeable vehicle are interrupted after Tuesday.

Many car manufacturers have relied on incentives to stimulate consumer demand for electric vehicles, which have spent billions of dollars to develop, even if vehicles remain largely unprofitable.

Analysts and industry leaders said they thought that sales of electric vehicles could continue to grow in the future, but that there will soon be a situation of boom and bottle regarding the demand for electric vehicles before there is a new normal.

“We are going to see noise in October and November, and I expect EV’s request will fall quite precipitately”, ” General Motors Financial director Paul Jacobson said at an investor event at the start of the month. “We must let it settle and understand where this natural request takes place and how to respond to this natural demand and, ultimately, try to drive customers to electric vehicles. It will take a little time.”

Jacobson’s remarks echo those of other industry leaders such as the CEO of Hyundai Motor José Muñoz and Tesla CEO Elon Musk.

“We adapt to the new situation and … we expect the mixture of batteries to be probably [not] Growing up as much as we already thought, “Muñoz told journalists earlier this month.” I think that in the short term, it will decrease, but halfway through long-term, we expect it continues to grow. “”

Musk, during the discussion of the company’s second quarter results in July, said that the manufacturer of electric vehicles could see “a few difficult districts” with the end of federal incentives and that Tesla automation plans are in their infancy.

But that might not happen immediately. Before the end of the Federal EV program, many car manufacturers encouraged consumers to buy or rent new vehicles. This included the American leader EV Tesla with a countdown on his website until the end of federal incentives, which the company has historically used to promote the prices of vehicles lower on its site.

Federal incentives for consumers to buy electrified vehicles have been in place since 2008, in different forms. They were presented for the first time under the Republican President George W. Bush and were extended under former President Barack Obama, a democrat.

Incitations relate to an end as part of the “One Big Beautiful Bill Act” of the Trump administration, which has stripped the old stay, but included advantages to buy an American assembled vehicle, whatever the VE.

“Politics are really important and ward off all these levers will slow growth compared to what the path was previously,” Elaine Buckberg, principal researcher at Harvard University and former GM chief economist, said on Wednesday at the Move America conference.

Once the bill has been adopted, EV sales quickly gained ground, especially since some car manufacturers have added even more discounts to keep old models away.

COX Automotive provides that EV sales reached 410,000 in the third quarter, up 21% compared to the previous year. It would be easily the greatest number of EVs ever sold in a quarter in the United States, as well as a record market share of 10%.

“The federal tax credit has been a key catalyst for the adoption of the EV, and its expiration marks a pivotal moment. This change will test if the electric vehicle market is mature enough to prosper on its own fundamentals or still needs support to develop further,” said Stephanie Valdez Streaty, COX Automotive Director of Industry.

Cox expects many buyers to be taken before the purchase plans for an EV before the federal sunset. This was the case for the buyer Paarth Sharma of New Jersey.

“I have been on the market for two to six weeks,” Sharma, which has rented a Kia Niro EV, told CNBC. “He just accelerated due to the next September 30 prescription from Donald Trump and the EV discounts by disappearing.”

The increase in sales corresponded to a significant increase in the incentives of car manufacturers for electric vehicles, because more buyers who qualified for offers rushed to buy vehicles. COX Automotive reports that average incentive expenses for electric vehicles were greater than $ 9,000, more than double the industry average.

“The quarter has made record sales and market shares, but the pace will facilitate the fourth quarter and beyond while the impact of the IRA fiscal incentive begins to fade,” said Valdez Streaty.

While car manufacturers have said that they would continue to offer electric vehicles, many companies are already taking measures to prepare for the expected sales impacts, in particular by linking workers, reducing the production of electric vehicles or completely eliminating vehicles.

Honda Motor Wednesday, citing market conditions, confirmed plans to end the United States in the American production of its Acura ZDX electric crossing which was produced by GM in Tennessee.

ACURA EV, GM has made several modifications to its production plans for electric vehicles that have included the implementation of downtime in factories, reducing upcoming production changes and the slowdown in its deployment of several models.

Others like VolkswagenPorsche and Rivian Automotive have announced modifications to their electric vehicle plans or reductions in the workforce linked to electric vehicles.

“Electric vehicles do not disappear … But it will not be a linear increase that we have seen in the past two years, as we could decrease in the short term,” said Steve Horaney, vice-president of original MEMA equipment suppliers, said on Wednesday during the Move America event.

But some plans are already too far to come back. New models soon arrive, like a redesigned Nissan sheet – undoubtedly the first traditional EV that was offered in the United States when it was launched in 2010.

Nissan officials during an event touting the new model said that the end of the credit calendar with the fall release of the new sheet was “difficult”, but even without the tax credit, the price of the vehicle – from around $ 30,000 – should attract buyers.

According to Valdez Stream, these types of low -cost vehicles should be even more important for customers and electric vehicle companies after the disposal of tax credits.

“The arrival of really affordable models is so critical,” she said, citing the upcoming electric vehicles of GM and Ford Motor. “”[They] could reshape the market. “”