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Today's Featured Article Carmakers Move to Provide Incentives as EV Tax Credit EndsWritten by Jordan Chussler. Published 10/6/2025. President Trump's relatively brief enthusiasm for electric vehicles (EVs) mirrored his fleeting collaboration with Tesla (NASDAQ: TSLA) CEO Elon Musk. Early this year, at a White House South Lawn event, Trump announced he would purchase a red Tesla Model S to support Musk. By June, however, amid their deteriorating relationship, the White House disclosed that the president was exploring options to sell or donate the vehicle. Just days later, on July 4, the One Big Beautiful Bill Act (OBBBA) became law, signaling the federal government's intent to curb the U.S. EV industry. Among its provisions was the elimination of the federal EV tax credit—initially extended and modified by the Biden administration's Inflation Reduction Act—as of Sept. 30, 2025. Terminating the incentive delivered a blow to the burgeoning EV market, which saw U.S. sales rise from roughly 233,000 units in 2020 to over 1.5 million in 2024. Yet this is far from a death knell. According to Grand View Research, the global EV market is projected to grow at a 32.5% compound annual growth rate (CAGR) from 2025 to 2030. While the Asia-Pacific region remains the largest market, the U.S. is expected to post the fastest CAGR through the decade. 5 Best Cheap Stocks Under $5!
Ready to discover hidden gems in the stock market? 📈 Download our free report featuring 5 top stocks trading under $5 with massive growth potential. Perfect for value-driven investors looking to uncover low-priced winners. Don't miss out! Key Points - The Big Beautiful Bill marked the end of the federal government’s EV tax credit.
- EV sales in the United States reached an all-time high last year, and were seeing strength in Q2 as the tax credit’s end loomed.
- Legacy automakers like Ford and General Motors have found a way to provide a nearly identical incentive to EV buyers in hopes of keeping their electrified transition rolling.
Unsurprisingly, legacy automakers like Ford Motor Company (NYSE: F) and General Motors (NYSE: GM) have devised a workaround, effectively offering customers the equivalent of the $7,500 federal EV tax credit despite its expiration. Legacy Automakers Forge Their Own Path Forward … With a Catch With the Sept. 30 deadline looming, Ford and GM took proactive steps to preserve the credit's value for buyers. Following IRS guidelines for clean vehicle credits, each automaker's finance arm made down payments on EVs before the expiration date. Those deposits satisfy the IRS criteria, allowing dealers to extend the $7,500 benefit to customers for vehicles either in stock or en route. There's a catch: the offer applies only to pre-qualified leased EVs. Separately, buyers of qualifying used EVs can claim a $4,000 credit. According to Ford Credit, these incentives will be available through Dec. 31. While this appears to be a stopgap measure, it underscores both companies' commitment to electrification. Both Companies Are Heavily Invested in the EV Transition Although extending tax credit savings may be temporary, both Ford and GM are focused on an electric future. Ford has committed $5 billion to electrifying its lineup. This includes funding 4,000 American jobs at the Louisville Assembly Plant and Michigan's BlueOval Battery Park to build a new EV pickup and produce advanced prismatic LFP batteries. The company is also developing its Universal EV platform to produce affordable EVs at scale, complete with over-the-air updates. The inaugural model will be a midsize, four-door electric pickup with a target MSRP around $30,000, slated for delivery in 2027. Ford is simultaneously implementing the Universal EV Production System, designed to simplify assembly for enhanced safety, quality, and speed. GM plans to invest $4 billion over two years to expand its EV operations and boost production of internal combustion engine vehicles. A centerpiece of this plan is converting its Detroit-Hamtramck plant—now Factory ZERO—into a 100% EV facility, producing the Chevrolet Silverado EV, GMC Sierra EV, Cadillac Escalade IQ, and GMC Hummer EV pickup and SUV. What Does That Mean for Investors? In the near term, higher capex on EVs may pressure earnings, but the long-term outlook could improve as EV adoption grows. Wall Street remains cautious: Ford's average one-year price target sits about 13% below its current share price, while GM's average one-year price target is only 8% above. Institutional investors seem to favor GM, which has 93% institutional ownership versus Ford's 58% institutional ownership. With GM now the second-largest EV manufacturer in the U.S.—its Q2 EV sales jumped 111% year over year, representing 16% of the U.S. EV market—it may be where the smart money is headed.
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