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The EV market in America, what’s left of it, is about to undergo a code-red emergency. It’s not like this wasn’t apparent to anyone watching as a neutral party. As we predicted, the affordable EV market contraction came first. It happened in 2024. Then EV pickups failed miserably, with Cybertruck a fiasco, and the Ford, GM, and Rivian trucks all selling at numbers so low they look like they are missing two digits. Now the “free money” is gone from the EV pity party. So what is about to change? A lot.
Automakers Are Going to Slow or Stop Building EVs For Inventory
Automakers sank billions into EVs, and many have union labor contracts to honor, so they won’t just up and cancel them all on October 1st when the EV subsidies evaporate. Instead, they will do what is already happening. They will scale back the volume they make to the bare minimum. Many brands have already done this, including Tesla, Ford, GM, and Rivian. The reporting on Rivian’s plant shutdown was interesting. In April of 2024, the Illinois Rivian plant was shut for multiple weeks to “Introduce new technologies,” according to Electrek. The same plant is now reportedly going to close again to allow the company to make its new model, the R2 there. However, the plant where the R2 was originally planned to be built is in Georgia.
As I was typing this story, Automotive News reported that GM is closing the plant in Detroit that builds the GMC Hummer EV and Cadillac Escalade IQ. “For at least a month…” It’s going to be a wait-and-see period for the production of existing slow-moving EVs. Apart from the Model 3 and Model Y, all EVs in America meet the definition of slow-moving. Slow-moving EV sales were also to blame for a GM Canadian EV plant closure last month.
Cox Automotive reported that EV inventory constricted dramatically in July, saying, “EV days’ supply (of inventory) fell sharply to 87 days, down 32.3% month-over-month and 49.0% year-over-year.” Automakers have stopped building EVs so they would not repeat the Cybertruck’s inventory disaster. This slowing of EV production will continue as automakers try to match pace with the EV sales slump that will begin this coming October.
Automakers Will Stop Development on Low-Cost EVs For America
Automakers will cancel future affordable EV models that are not too far into the development process. You may have already noticed that many affordable models hyped by the EV-advocacy media never materialized. Where is the VW ID.2? Where is the Tesla Model 2? Where is the Kia EV3? How about Jeep’s “$25K EV?” These were all reported on by the EV-advocacy media as if they were done deals. Volvo’s “$35K” EX30 did arrive, but at about 30% higher in price than the media pretended it would cost.
Future EV Launches Are Being Quietly Canceled
Many EV models that we expected to see in the U.S. market have already been canceled. The three-row electric Ford SUV was notably canned. Honda also canceled its electric SUV. Genesis pulled the electric GV80 off the market. It has been reported that Nissan is canceling two electric crossovers for the U.S. market.
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EVs Won’t Suddenly Disappear – Here Is the Way They Will Lose Market Share
Customers will still be able to buy EVs. The August numbers will likely even show a robust month of EV deliveries as EV owners rush to replace older EV models, and fence sitters are motivated to take action before the end of the subsidies. September is hard to predict. Will there even be enough EVs on lots to maintain the 8% market share EVs have seen over the past 24 months?
In Q4, EV market share in America will start its inevitable decline. We say ‘inevitable’ not because we’ve thought hard about what shoppers want. Instead, production and inventory are declining, so there will be few left to buy. Tesla’s market share will rise again. Tesla’s Model 3 and Y are successful models, and the company didn’t see any meaningful impact from the failed Tesla Takedown protests. By the end of 2025, the anti-Musk noises from the vocal fringe will be long forgotten.
In Q1 2026, EV market share will step back to 2024 levels, and by year’s end, it may decline as far as 2023 levels. We expect that battery-electric vehicles will settle in at around 5% market share. It is likely that only a handful of successful models will make up 70% of the EV volume in America by the end of 2026. Two Teslas and a Chevy.
Tell Us Where We Are Mistaken
Our prediction is based on the best available data we have. You may have better insights. Please tell us in the comments section below what you think the U.S. EV market will look like over the next year and a half and why.
John Goreham is the Vice President of the New England Motor Press Association and an expert vehicle tester. John completed an engineering program with a focus on electric vehicles, followed by two decades of work in high-tech, biopharma, and the automotive supply chain before becoming a news contributor. He is a member of the Society of Automotive Engineers (SAE int). In addition to his eleven years of work at Torque News, John has published thousands of articles and reviews at American news outlets. He is known for offering unfiltered opinions on vehicle topics. You can connect with John on LinkedIn and follow his work on his personal X channel or on our X channel. Please note that stories carrying John’s by-line are never AI-generated, but he does employ grammar and punctuation software when proofreading and he also uses image generation tools.
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Source: torquenews.com
