EV Sales Plunge 43% in October as Tax Credit Expiration Bites Hard

The numbers are in, and they’re about as bad as the forecasters predicted. October 2025 saw US retail EV share collapse to an estimated 5.2 percent of new vehicle sales, according to J.D. Power’s forecast published in late October — a 42 percent drop from September’s post-credit-surge figure of 8.9 percent. Total new vehicle sales for the month were projected at approximately 1,249,800 units, a 6.9 percent year-over-year decline, with EVs accounting for a dramatically smaller slice of a shrinking pie.

The NADA Market Beat, publishing official data on October 31, confirmed the collapse with hard numbers. BEV sales totaled 74,985 units for the month — a decline of 46.7 percent from September’s 140,000-plus units and a 23.8 percent drop compared to October 2024. Those are not rounding errors. That’s a market recalibration.

Why October Was Always Going to Be Ugly

The mechanics of the credit expiration were not subtle. The federal EV tax credit, which had been gradually phased out for individual manufacturers as they crossed the 200,000-unit sales threshold, was available to most mainstream EV buyers throughout 2025 for vehicles assembled in North America. Tesla had already lost eligibility for the credit on its vehicles in early 2023, but GM, Ford, Hyundai, Kia, Rivian, and others still qualified.

Buyers who were already in the market for an EV had a powerful financial incentive to close the deal before the credit expired. The result was a surge in September sales that pulled forward demand from October, November, and December. When October arrived without the credit, the market snapped back to a level that looked — by comparison — catastrophic.

The effect was particularly pronounced for brands like Hyundai and Kia, which had seen strong EV sales momentum in 2024 and early 2025. The Ioniq 5 and EV6, which had benefited from the credit along with strong product appeal, saw significant sales declines in October. Honda’s Prologue — an EV that was barely getting started in the US market — was also notably affected, with its early sales numbers distorted by the credit-driven September pull-forward.

J.D. Power’s Revision Was Brutal and Accurate

In its mid-October forecast revision, J.D. Power was explicit about what it expected. The firm’s automotive retail forecasting team predicted that the retail EV share would fall to approximately 5.2 percent in October, down from the already-depressed pace of prior months. The firm noted that the September surge had created “artificial” volume that would not repeat, and that October would represent a “recalibration” of actual market demand.

Cox Automotive’s analysis, published October 27 alongside its monthly sales forecast, offered a slightly less dire but still significant read. The firm’s EV Market Monitor noted that the average transaction price for new EVs had risen to $59,125 in October — up 1.6 percent from September and 2.3 percent year over year. That price increase reflected the shift in sales mix toward higher-trim vehicles as entry-level and mid-market EVs became more price-sensitive without the credit.

Ford Fights Back With Hybrids; GM Doubles Down

Ford’s October sales report, released November 3, showed an interesting counterpoint to the EV collapse. While Ford’s EV sales fell, the company’s overall US sales rose 1.6 percent, driven by continued strength in its pickup truck lineup — especially the F-150. Ford also reported that its hybrid vehicle sales had been growing meaningfully, offering a middle ground for buyers who wanted improved fuel economy without committing to a full EV.

GM’s Chief Product Officer, Sterling Anderson, appeared on automotive industry podcasts in late October to frame the EV sales decline as a transitional phenomenon rather than a structural problem. Anderson argued that GM’s EV sales on a unit basis had doubled quarter-over-quarter, even as the overall market share calculation made the numbers look worse on a percentage basis. The company has maintained its long-term EV investment roadmap despite the near-term turbulence.

Tesla’s Relative Strength

Tesla’s October performance, relative to the rest of the market, was noteworthy. While the company has not yet released October-specific US delivery figures as of this writing, early data suggests Tesla maintained a larger share of EV sales than its competitors in October — which is notable given that Tesla’s vehicles haven’t qualified for the federal credit since early 2023.

This creates an uncomfortable irony for policymakers: the company that was perhaps most critical of the credit’s effectiveness (Elon Musk publicly opposed its extension in late 2025) appears least affected by its removal. Tesla buyers have been paying full price for their vehicles for nearly three years, so October’s sticker shock was not new to them. Legacy automakers, by contrast, had conditioned a portion of their EV demand on the credit’s availability.

What Comes Next

The October data leaves the industry with an uncomfortable question: what does the US EV market look like without a federal incentive? The answer will arrive over the coming months as the comparison base normalizes. November and December numbers will be watched closely to determine whether EV share stabilizes around the 5-6 percent range or continues to decline.

Automakers including Ford and GM have reportedly been in discussions with policymakers about potential replacements for the credit — potentially in the form of point-of-sale rebates, fleet incentives, or charging infrastructure funding. Whether those discussions produce results before 2026 models arrive at dealerships remains uncertain. In the meantime, the October numbers stand as the clearest evidence yet that US EV adoption, at least in the near term, remains closely tied to financial incentives rather than pure market demand.