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The US electric vehicle (EV) market posted its highest-ever monthly sales in August, with over 175,000 units sold, according to Rho Motion’s EV & Battery Database. This follows July 2025, which was the third-strongest month on record, and surpasses the previous record set in December 2024 by over 15,000 units. Consequently, sales in the country are up 10% in the first eight months of the year. The surge reflects a consumer pull-forward effect, as buyers move ahead of the expiry of federal tax credits in September, following the passage of the “One Big Beautiful Bill Act” (OBBBA) in July.
How is the market playing out?
Under the OBBBA, from 30 September the 30D purchase credit and the 45W leasing credit – both worth up to $7,500 on eligible EVs – will end. Consumers have accelerated purchases to take advantage of the incentives, with 30D-eligible models leading the growth.
Many OEMs registered record sales in July and August. The Honda Prologue logged its best-ever month with more than 9,300 units sold, while the Ioniq 5 had its two strongest months yet over the period. The Chevrolet Equinox also exceeded its previous monthly record by close to 30%.
Similarly companies have posted their strongest ever months for BEV sales. GM sold more than 19,000 BEVs in July and 21,000 in August, surpassing its previous record of 16,000 in a single month. Hyundai–Kia likewise reported a record month in the US with more than 15,000 BEVs sold.
What comes next?
Sales are expected to show continued unseasonal strength in September, but Benchmark analysts expect a slowdown once the tax credits expire, as future demand has effectively been pulled forward. “Our EV sales expectation for the year is completely flat” commented Will Roberts, Automotive Research Lead at Rho Motion.
“There’s high uncertainty of how big the EV sales drop off will be in Q4.” Roberts continued.
Other markets that had EV subsidies removed saw substantial drops. For example, Germany’s EV market fell 19% in 2024 compared to 2023 following the removal of subsidies.
Automakers are already adjusting to this expected dip. VW has announced plans to scale back ID.4 production in the US from October, while GM will cut output at several EV facilities.
More information
For a deeper analysis of how these policy shifts could reshape the market, see our Critical Insight: ‘How will the OBBBA affect the US energy transition?’ [/only_iu]
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