Electric vehicle, hybrid sales accelerate as end of federal tax credit looms

Car shoppers are racing to buy electric vehicles (EVs) before time runs out. With the federal tax credit for new and used EVs and some plug-in hybrids set to expire at the end of September, CARFAX data shows EVs and hybrids are selling much faster than usual, even as their prices hold steady.

Now, EVs and hybrids are selling about 30% faster than they were at the start of the summer, according to CARFAX data. Over the same period, overall vehicle sales have remained mostly steady, despite analysis showing that overall vehicle sales trends typically align with EV and hybrid sales. This gap marks a major shift in consumer buying behavior, as EV and hybrid demand break from traditional sales patterns seen over the last few years.

"EV and hybrid sales are spiking, yet prices remain stable," says Patrick Olsen, editor-in-chief at CARFAX. "For shoppers considering a purchase, experts say now is the time to act."

The Inflation Reduction Act included EV and some plug-in hybrid incentives with a $7,500 tax credit for new models and $4,000 for used ones. This summer, Congress voted to eliminate the credits, setting September 30 as the final day for eligible purchases to qualify.