Thousands of auto dealers sign up to offer new on-the-spot tax credit
New year, new rules: As of January 1, things are about to get a little easier when it comes to getting your federal tax credit for buying an electric vehicle. Now the rebate – which is up to $7,500 for new EVs that qualify, and up to $4,000 for used EVs that qualify – is available immediately when you purchase your car, rather than needing to wait potentially months to file a claim with your tax return. And auto dealers are signing up in droves with the IRS.
To help gear up for the insta-credit program, more than 7,000 car dealers have signed up with the Internal Revenue Service to ensure they can offer the point-of-sale rebate to EV buyers starting January 1 – that accounts for nearly half of all new car dealerships in the US, reports Automotive News.
On paper at least, EV buyers pay a reduced fee upfront, while the dealer handles the paperwork with the IRS, and then the EV buyer happily gets behind the wheel and drives away.
Of course, the number of vehicles that qualify for the full rebate, or any rebate, will shrink starting January 1 as well, as President Biden’s new restrictions on electric vehicles and battery sourcing will kick in. To qualify at all, vehicles have to be manufactured in North America with an MSRP under $80,000 for an SUV and $55,000 for a standard or smaller car.
Vehicles can qualify a federal tax credit of $3,750 if automakers adhere to specific guidelines on sourcing battery materials. To get the rebate, 40% of the value of critical minerals used in the battery need to be extracted or processed in the US, or in a country that is a US free trade agreement partner, or they must have been made from recycled materials in North America. Also, a vehicle will qualify for an additional $3,750 if 50% of the value of critical battery components are manufactured or assembled in North America. Those percentages will go up every year until the credit expires in 2032. Additionally, all EVs that contain any battery components from a foreign entity of concern (as in China) will be excluded in 2024, and that rule applies to battery minerals as of 2025.
We’ll get the final word on exactly which vehicles are eligible in January, according to the report. Still, the Ford F-150, Chevrolet Bolt, Jeep Grand Cherokee 4xe, Jeep Wrangler 4×3, Rivian R1S and R1T, and maybe the Volkswagen ID.4 are likely to still be eligible for a $7,500 credit in 2024. Tesla’s Long Range and RWD Model 3 variants will no longer qualify, nor will Ford’s Mustang Mach-E, Chevrolet Blazer EV, or the Cadillac Lyriq.
Electrek’s Take
Automobile dealers have, of course, been highly vocal opponents of the transition to electric vehicles, for a host of financially driven reasons, some of them of course justified if you didn’t care at all about carbon emissions. EVs require less maintenance, meaning a cut in after-sales profits, and staff needs to be educated on how to chat up customers about batteries and range, charging infrastructure needs to be installed, etc. Last month, nearly 4,000 car dealerships in the US wrote a letter to President Biden pleading that the government put the brakes on its adoption of EVs, saying customers aren’t interested in buying them and that electric vehicles are piling up on their lots – which left out the detail that new vehicles of all types are piling up as well. So yeah, opposition has been fierce. But maybe this new strategy will shake things up and give dealers a morale boost. It’s an easy incentive for customers to choose an electric vehicle, and this could help more some inventory around to free up space for new vehicles.
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Global EV sales surged in May 2025, hitting 1.6 million units sold, according to the latest data from EV research house Rho Motion. That brings the total for the year so far to 7.2 million EVs, a 28% increase compared to the same period in 2024.
The big winner: China. The country sold a record-breaking 1 million EVs in May alone. That’s a 33% jump year-over-year, and a 10% boost compared to April. The rest of the world saw solid gains too, but North America lagged far behind, mainly due to slashed incentives in Canada.
Rho Motion’s Charles Lester broke it down: “The story this month with global vehicle sales is the continued chasm between Chinese market growth, which saw 1 million vehicles sold in May, versus the faltering market in North America.”
Let’s take a closer look:
Europe holds steady, with help from Spain and Italy. Europe is up 27% year-to-date, with 1.6 million EVs sold from January through May. Countries like Germany (+45% YTD) and the UK (+32% YTD) are helping lead the way, but southern Europe is really stepping on the accelerator. Spain saw a whopping 72% growth in EV sales so far this year, and Italy isn’t far behind at 58%.
Germany just rolled out a new set of EV incentives focused on commercial fleets. With corporate vehicles making up more than half the German auto market, those tax breaks and special depreciation offers could supercharge sales in the coming months.
North America stalls out. The US, Canada, and Mexico are dragging, with just 3% growth YTD. That’s mostly due to Canada’s pause on EV subsidies, which caused a steep 20% sales drop.
The US is holding on with 4% growth, helped by the federal EV tax credit that remains in place through the end of the year. But those credits start phasing out in 2026 and will disappear by 2027, if the Republicans don’t kill them even sooner. Expect a late-year bump as buyers rush to cash in while they still can.
China dominates again. China continues to be the EV powerhouse. In May, it became the first country this year to break the 1-million-EVs-sold-in-a-month mark. It first hit that level in August 2024, and it hit the milestone again just ahead of the summer push.
Chinese automakers aren’t slowing down either. BYD is expanding its presence in Europe with new BEVs and plug-in hybrids. Its tiny budget EV, the Dolphin Surf (called the Seagull in China), just launched in Europe with a price tag around $25,000, and it’s not subject to new EU tariffs on Chinese EVs, since it’s a hybrid.
Here’s how 2025 EV sales stack up through May:
- Global: 7.2 million (+28%)
- China: 4.4 million (+33%)
- Europe: 1.6 million (+27%)
- North America: 0.7 million (+3%)
- Rest of World: 0.6 million (+36%)
Read more: 1 in 4 cars sold in 2025 will be EVs, and that’s just the beginning
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Hyundai’s new electric SUV is more affordable than you might think. The IONIQ 9 is currently a better deal than the Kia EV9, with Hyundai offering up to $13,000 off.
Hyundai IONIQ 9 is even more affordable with June deals
After delivering the first IONIQ 9 models just last month, Hyundai is already offering discounts. Despite a starting price of over $60,500, the 2026 Hyundai IONIQ 9 is currently listed for lease at just $419 per month.
The offer is for 36 months with $4,999 due at signing. At that, you’ll end up paying $558 per month. That’s even cheaper than Kia’s three-row electric SUV, despite an MSRP that’s nearly $5,000 more.
Kia’s EV9 is currently listed for lease at $429 for 36 months. With $4,999 due at signing, the effective rate is $568 per month, or $10 more than the IONIQ 9.
The IONIQ 9 is more affordable thanks to Hyundai’s generous $13,000 lease cash offer. Kia, on the other hand, is only offering $7,500, or essentially passing on the federal EV tax credit for lessees.
You can even upgrade to the AWD SE or SEL trims for just $449 or $449 per month for 36 months. The offer also includes $4,999 due at signing. Alternatively, you can opt for 1.99% APR financing for up to 60 months, offered on all 2026 IONIQ 9 trims.
The 2026 Hyundai IONIQ 9 S starts at $60,555, including destination, with a range of 335 miles. The AWD SE and SEL models offer 320 miles of range, starting at $64,365 and $67,920, respectively.
Inside, the electric SUV boasts up to 2,462 liters (87 cubic feet) of interior cargo space, which is even more than the Ford Explorer. The 2025 Ford Explorer has a cargo capacity of up to 2,429 liters (85.8 cubic feet).
The IONIQ 9 is not only spacious, but it’s also loaded with Hyundai’s latest tech and features. The infotainment system consists of a dual 12.3″ driver cluster and infotainment screens as part of a curved panoramic display.
Like the upgraded 2025 Hyundai IONIQ 5, the IONIQ 9 features a built-in NACS port, allowing you to use Tesla Superchargers.
If you’re looking for something a little smaller, the 2025 IONIQ 5 is hard to pass up right now with leases starting at just $179 per month. Last month, it was listed at $209 per month, which was still considered one of the best EV deals.
| 2026 Hyundai IONIQ 9 Model | EV Powertrain | Drivetrain | Driving Range (miles) |
Starting Price (including destination fee) |
Lease Price (per month for June 2025): |
| IONIQ 9 RWD S | 160-kW (215-HP) Electric Motor |
Rear- Wheel Drive |
335 | $60,555 | $419 |
| IONIQ 9 AWD SE | 226.1 kW (303-HP) Dual Electric Motors |
All-Wheel Drive |
320 | $64,365 | $449 |
| IONIQ 9 AWD SEL | 226.1-kW (303-HP) Dual Electric Motors |
All-Wheel Drive |
320 | $67,920 | $499 |
| IONIQ 9 AWD PERFORMANCE LIMITED |
314.6-kW (422-HP) Dual Electric Motors |
All-Wheel Drive |
311 | $72,850 | $589 |
| IONIQ 9 AWD PERFORMANCE CALLIGRAPHY |
314.6-kW (422-HP) Dual Electric Motors |
All-Wheel Drive |
311 | $76,590 | $689 |
| IONIQ 9 AWD PERFORMANCE CALLIGRAPHY DESIGN |
314.6-kW (422-HP) Dual Electric Motors |
All-Wheel Drive |
311 | $78,090 | $729 |
The 2025MY is an upgrade in nearly every way, featuring increased range (now up to 318 miles), a new exterior and interior design, and an added Tesla NACS port.
To sweeten the deal, Hyundai is also offering a complimentary ChargePoint Home Flex Level 2 charger with the purchase of any new 2026 IONIQ 9 or 2025 IONIQ 5.
Ready to try one out for yourself? We can help you find Hyundai IONIQ 9 and IONIQ 5 models in your area. Check out our links below to see offers in your area.
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