Major Companies, Including Costco, Ford, and GM, Invoke the Streisand Effect Regarding Electric Vehicles
In just a few months, the federal tax credit for electric vehicles (EVs) in the US will come to an end. Here's what you need to know if you're planning to purchase or lease an EV.
The One Big Beautiful Bill Act (OBBBA), signed into law by President Donald Trump on July 4, 2025, eliminates the previously scheduled continuation of the EV tax credit that was originally set to last until 2032 under the Inflation Reduction Act. The federal tax credit for new EVs will be available only through September 30, 2025, with a maximum credit of up to $7,500. Used EV buyers can claim a credit up to $4,000, subject to eligibility requirements such as income limits and vehicle qualifications.
After September 30, 2025, no federal tax credits will be available for new or used electric vehicles, regardless of where they are made. To take advantage of these incentives, buyers should act quickly.
The OBBBA also introduced a new tax deduction allowing up to $10,000 per year in interest paid on qualifying auto loans. However, economists estimate that only a small fraction of car buyers will be eligible to fully benefit from this deduction.
Meanwhile, the automotive industry is gearing up for a shift towards EVs. Ford, for instance, is planning a high-profile media event on August 11, 2025, to reveal its affordable EV plans, which it refers to as its "Model T Moment." The company has been learning from China's successful, affordable EV journey.
General Motors (GM) has also been focusing on EVs, announcing last week that it would buy low-cost LFP batteries from the top Chinese battery maker CATL for its forthcoming Chevy Bolt over the next two years.
The end of the EV tax credit doesn't mean the end of the road for EV adoption. With lower service costs, electric vehicles have a head start over conventional cars. However, repair costs following a collision may still be expensive.
Costco, a popular wholesale buying club, has been proactive in supporting EV adoption. Last week, the company added new members-only incentives for both GM and Volvo vehicles. Costco also launched the Costco Auto online EV Marketplace earlier this year, offering electric vehicle buyer guides and features. Costco Auto service, a part of Costco, offers a "haggle-free" experience at participating car dealers and includes electric vehicles.
As the EV landscape continues to evolve, it's essential for buyers to stay informed and act quickly to take advantage of federal incentives before they expire.
- The federal tax credit for new electric vehicles (electric-vehicles) will be available only through September 30, 2025, with a maximum credit of up to $7,500.
- After September 30, 2025, no federal tax credits will be available for new or used electric vehicles (electric-vehicles), regardless of where they are made.
- To take advantage of these incentives, buyers should act quickly (business, lifestyle).
- The OBBBA also introduced a new tax deduction allowing up to $10,000 per year in interest paid on qualifying auto loans (finance), but economists estimate that only a small fraction of car buyers will be eligible to fully benefit from this deduction.
- Meanwhile, the automotive industry is gearing up for a shift towards EVs (technology, cars), with companies like Ford (business) planning to reveal affordable EV plans and General Motors (GM) announcing plans to buy low-cost LFP batteries for its Chevy Bolt (charging, electric-vehicles).
