Automakers Ford, GM and Hyundai slash EV prices to offset end of $7,500 federal tax break

Ford, General Motors, and Hyundai confirmed on Tuesday that they are extending discounts on electric vehicles to counter the expiration of the $7,500 federal EV tax credit, which officially ended on September 30, 2025, according to information provided by all three companies.

The automakers said the discounts are meant to keep EV sales from plunging after a record third quarter. They are also trying to clear existing inventories of electric cars that were ordered before the credit ran out.

Ford and GM are extending the full $7,500 discount on leased EVs that are already on dealer lots or in transit to showrooms. Hyundai is applying the rebate more broadly.

The company is offering $7,500 cash on both purchases and leases of the 2025 Ioniq 5, and it is also cutting the sticker price of the 2026 Ioniq 5 by as much as $9,800, depending on the trim level. All of this is being paid for directly by Hyundai rather than the federal government.

Trump policy changes slow EV market and raise costs

The companies warned that EV sales will slow in the coming months as President Donald Trump’s administration rolls out policies aimed at encouraging gasoline and hybrid models instead of battery-only vehicles.

Automakers are adjusting production plans and preparing to offer more non-electric cars as demand for full battery-electric vehicles cools. Many American buyers are still staying away from EVs because of high prices and unreliable charging networks.

“I wouldn’t be surprised if EV sales in the US go down to 5% from about 10% now,” Jim Farley, the chief executive officer of Ford, said at a conference in Detroit this week. Farley also said the EV market will be “way smaller than we thought.”

Automakers are already dealing with higher costs as Trump’s new trade deals impose tariffs on imported vehicles and auto parts. Based on research from Cox Automotive, those tariffs could add $5,500 to the price of an imported vehicle and $1,000 even to U.S.-built cars that use foreign components.

A September forecast from EY, a consulting arm of Ernst & Young Global, showed the U.S. EV market only reaching 11% of new car sales by 2029, up from 8.1% last year. Europe and China are far ahead. EY expects Europe’s EV share to pass 50% by 2032 and China’s to pass 50% by 2033. This gap is shaping how different carmakers approach their product plans.

Hyundai funds rebates as GM locks in federal credits pre-deadline

Hyundai is also retooling its $5.5 billion plant in Savannah, Georgia to build both hybrid and electric models for the U.S. market. “Because of the surge we saw in September, there’s going to be a reset in October, maybe November. But the EV market will settle,” said Randy Parker, Hyundai’s North America chief executive.

Parker added, “There was an EV market before the IRA and there’s gonna be an EV market after the IRA,” referring to President Joe Biden’s Inflation Reduction Act, which created the now-expired tax credit.

Hyundai said it is using its own funds to finance the $7,500 cash rebate on the 2025 Ioniq 5 and the discounts on the 2026 models. Parker said this shows Hyundai’s ability to operate “with a lot of uncertainty.”

GM and Ford are taking a different path. GM Financial placed down payments on about 30,000 EVs before October 1 to secure the tax credit ahead of time. This allows GM to lease the vehicles with the $7,500 credit already included in the price.

Once a lease is written, the Internal Revenue Service reimburses GM Financial. Ford Credit is running a similar plan, saying in a statement it will provide “competitive lease payments on retail leases through Ford Credit until Dec. 31.”

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