US Battery Makers Gave Up Waaaaay Too Soon On EV Sales (But They Have A Backup Plan)
Why it matters: US EV market miscalculation: tax credit expiration met with rising gas prices, leaving manufacturers behind.
- US battery makers and automakers, including Ford and GM, significantly dialed down electrification plans after the $7,500 federal EV tax credit expired in September, leading to a "Great EV Battery Bust."
- CleanTechnica reporter José Pontes found that global plug-in vehicle sales were down 6% year-over-year in January, with almost all of the damage concentrated in the US and China due to rolled-back incentives.
- Excluding China and the USA, global EV sales actually jumped 36% year-over-year, indicating strong international growth where incentives remained.
- US President Donald Trump's war against Iran has caused a sharp increase in gasoline prices, with AAA reporting the average gallon of regular at $3.320, up from $2.982 last week, potentially creating new motivation for EV purchases.
- The Federal Reserve Bank of Dallas has documented the damage from the pullback, noting that over 20 gigafactories were announced in the U.S. from 2021-2022, many of which are now impacted.
US battery manufacturers and automakers prematurely scaled back EV production plans following the expiration of federal tax credits, despite a recent surge in gas prices due to geopolitical events that could reignite consumer interest in electric vehicles. While global EV sales (excluding the US and China) jumped 36% year-over-year, domestic markets saw a significant decline, leaving US companies potentially unprepared for a renewed demand for EVs.
