With the end of the $7500 federal tax credit for purchasing a new electric vehicle at the end of September, the US electric vehicle market plummeted in October, leading to a decline in the entire US light vehicle (including sedans, SUVs, MPVs, and pickups) new car market.

According to J.D. Power GlobalData and Cox Automotive, US light vehicle sales are expected to decline by 3% to 6.9% in October. Among them, retail sales, as a key barometer of market health, are expected to decline by 5.9% to 1.051 million units.

This is the first decline in the US light vehicle market since September last year.

Meanwhile, some analysts predict that if measured by seasonally adjusted annualized sales rate (SAAR), October will be 15.1-15.7 million vehicles, far lower than the 16.21 million vehicles in the same period last year. If that's the case, then October could become one of the weakest months in the US light vehicle market this year.
Indeed, under the successive impact of import tariffs and federal tax credits for electric vehicles, consumers have been actively rushing to purchase new cars since the beginning of this year, resulting in a continuous positive growth in the light vehicle market. However, as parts and cars affected by tariffs gradually enter the end market, electric vehicles have also lost their federal tax credit benefits, and the US car market is expected to enter a sluggish mode from October.

Subaru and Mazda have been continuously declining

Based on the specific sales figures released by six car companies, the US light vehicle market was indeed poor in October, with only Toyota increasing by more than double digits, Ford and Honda only slightly increasing, and Hyundai Kia, Subaru, and Mazda falling even further.

Toyota's October sales continued to increase by 11.8% year-on-year to 208000 units, with sub brands Toyota and Lexus both experiencing growth rates exceeding 10%. This is the eighth consecutive month of growth for the former, and the fourth month for the latter.

Toyota was able to stand out in October mainly due to the strong sales of some of its best-selling models, especially the Corolla, 4Runner, and Tacoma, which achieved double-digit or even triple digit growth year-on-year. The Grand Highlander, which sold only 660 units due to a recall in the same period last year, increased directly to 12860 units.

Of course, affected by the end of the federal electric vehicle tax credit, the sales of Toyota's two electric vehicles in October fell sharply year-on-year, with the Toyota bZ4X plummeting by 99% and the Lexus RZ's delivery volume dropping by 96%.

Ford Motor Company saw a slight increase of 1.5% to 174000 vehicles in October, while its Lincoln brand continued to decline by 13.4%. Fortunately, with the help of pickup trucks, the Ford brand achieved a growth of 2.4%, thus maintaining the upward trend of the entire group.

Data shows that Ford's electric vehicle sales in October fell by 25% year-on-year, with the Mustang Mach-E dropping by 12%, the F-150 Lightning dropping by 17%, and the E-Transit experiencing a significant decline of 76%.

Hyundai Kia ended 12 consecutive months of growth in October, with a slight drop of 1.0% to 146000 vehicles. Among its three brands, only Hyundai experienced a 2.3% decline, but due to the fact that both Genesis and Kia only added a few hundred vehicles, they were unable to compensate for the losses caused by Hyundai. As a result, the group ended with negative growth.

After the end of the tax credit for electric vehicles, in order to maintain the sales of electric vehicles, Hyundai Motor has significantly reduced prices or provided more discounts for some electric vehicles.

For example, throughout October, Hyundai will lower the price of the 2026 Ioniq 5 by up to $9800, while continuing to offer a $7500 discount for the 2025 model. However, in October, the Hyundai Ioniq 5 still fell by 63%, the Ioniq 6 also fell by 52%, and Kia's two best-selling electric vehicles, EV6 and EV9, experienced even greater declines.

Honda Motor saw a slight increase of 0.7% in October, while its best-selling sub brand Honda only grew by 0.5% due to a decline in SUV and pickup truck sales, while luxury brand Acura grew by 2.0%.

The sales of the group's electric vehicles have also been affected by the end of the policy, with Honda Prologue and discontinued Acura ZDX falling by 81% and 98% respectively. However, due to the relatively small number of models and sales, it has not had a significant impact on the brand or even the group.

Subaru has experienced its third consecutive month of decline in October due to the need to import a large number of models from Japan and start raising prices at the terminal. Sales of Forester and Outback, among its three best-selling models, have both declined, while its only electric vehicle, Solterra, has dropped by 99%, selling only 13 units.

Mazda, which also relies on imports, continued to decline in October, with a drop of 32.6%. It and Subaru are the only two car companies among the six that have accumulated negative year-on-year performance in the first 10 months of this year, which almost determines that both are likely to experience a decline throughout 2025.

Electric vehicle decline and tariffs drag down the US car market

Although the sales of new electric vehicles in the United States for October have not yet been released, J.D. Power predicts a 43% year-on-year decline in retail sales in this segment based on preliminary data from the first 16 sales days of October, which has dragged down the overall trend of the light vehicle market.

J. D. Power predicts that the retail sales of electric vehicles in October will be 54672 units, accounting for only 5.2% of the US light vehicle retail market, compared to 8.5% in the same period last year.

And this result was achieved on the premise that some car companies offered significant discounts on their electric vehicles in October. In addition to the Hyundai Kia mentioned earlier, Stellantis has also announced a $7500 discount on electric vehicles currently in dealership inventory, including Jeep's Wagoneer S, Wrangler 4xe, Grand Cherokee 4xe, and Dodge's Charger Daytona.

In addition, multiple brands such as Tesla, Chevrolet, and Nissan have launched electric vehicles at lower prices. For example, the second-generation Chevrolet Bolt, which returns in 2027, has a starting price of less than $30000 including shipping. Meanwhile, Tesla's new versions of Model Y and Model 3 are priced at nearly $40000.

However, the industry generally believes that the sales of electric vehicles in the United States will continue to plummet in the future. Some analysts believe that this sluggish trend may even last for several years, and some predict that it will begin to recover in 2026.

At the same time, car companies have also made corresponding adjustments.

Acura's first all-electric SUV, the ZDX, has been fully discontinued. Nissan has halted U.S. sales of its 2026 model year all-electric Ariya. Ram has canceled plans for its upcoming full-size all-electric pickup truck, and Kia will not proceed with U.S. production of the EV4 scheduled for early 2026. After phasing out underperforming electric vehicles or delaying/canceling existing EV projects, automakers have unveiled new plans. Acura announced it will launch the all-electric RSX on a new platform in 2026. Nissan is introducing a next-generation Leaf EV. Startups Rivian and Slate have also rolled out new models with higher cost-performance. However, most automakers have no intention of completely abandoning the electric vehicle market—electrification remains the inevitable future trend. As Randy Parker, CEO of Hyundai Motor North America, noted, demand for electric vehicles existed in the U.S. market even before the Inflation Reduction Act implemented tax credits for EVs. While the recent sales decline has temporarily disrupted momentum, a gradual recovery is expected in the future. In fact, beyond the slump in EV sales, the U.S. light vehicle market will face more severe challenges ahead, as prices of most models will continue to rise. Despite automakers' efforts to expand local procurement and production in the U.S., profit margins are being severely eroded by the launch of more new models and accumulating import tariff bills. Consequently, prices of new models—especially 2026 model year vehicles—have seen significant increases. For example, Volkswagen of America stated that the starting prices of most 2026 model year vehicles will rise by 1.9% to 6.5%. Audi, which relies heavily on imports, has increased 2026 model prices by $4,700. After a $750 price hike in July, the new Tiguan will see an additional $610 increase for the 2026 model year. Clearly, in the remaining months of November and December, the sharp decline in EV sales, price hikes driven by import tariffs, high loan interest rates, and weak consumer confidence will continue to impact the trajectory of the U.S. light vehicle market. Given that U.S. light vehicle sales reached 11.945 million units in the first three quarters of this year—502,000 more than the same period last year—it remains uncertain whether these gains can offset the fourth-quarter downturn and sustain full-year positive growth.