Connect with us

Published

1 year ago

on

Visitors inspect a Tesla Model Y car during the 40th Thailand International Motor Expo at the Impact Challenger hall in Nonthaburi. 

Sopa Images | Lightrocket | Getty Images

Tesla has a lot going on. A significant slump in sales, stoking concerns among investors and industry analysts, in an EV market where aggressive price cuts have been needed to spur demand, have tied into decisions made by Elon Musk’s company to lay off workers and scale back spending on its EV Supercharger network. Tesla’s stock price has declined by over 30% this year.

Then, there’s the whole trade war with China, in which Musk holds a unique position.

The U.S. government is determined to limit China’s ability to, as it says, “flood” the U.S. market with renewable energy products, including its rapidly growing supply of EVs, with models priced as low as $10,000. But Tesla has a major operation in China, similar in some ways to Apple, a market key to both its manufacturing and consumer demand. That has all put Musk under considerable pressure to unlock new growth frontiers while navigating challenges of increased competition, supply chain disruptions, and rising raw material costs.

The EV giant appears is paying more attention to the vast potential of Asia beyond China, one of the hottest EV markets. In addition to its well-known interest in India, Tesla is taking a closer look at Thailand, the EV capital of Southeast Asia, where green mobility is rapidly gaining traction.

Thai government officials have touted talks with Tesla as Musk scouts locations for the next gigafactory — Thailand has been part of those deliberations for a few years, as has India, where Musk was scheduled to pay a recent visit before he canceled it, citing issues at Tesla that needed to be dealt with — he did pay a visit to China soon after. The Southeast Asia region, no doubt, holds the potential to provide Tesla with a sizeable customer base to diversify away from overreliance on Europe and the U.S., and a distinct option for manufacturing apart from its existing operations in China and interest in India.

Tesla did not respond to requests for comment.

‘The Detroit of Asia’

Thailand, known as the “Detroit of Asia” for many years already due to its skilled workforce and success attracting many international auto companies, can help Tesla to reduce its dependence on China. With a manufacturing base in Thailand, Tesla could also serve Asian markets and beyond, potentially replicating China’s rapid growth trajectory.

“Thailand is a possible path to China-like auto parts costs, allowing low-cost production,” says Craig Irwin, senior research analyst at Roth Capital who covers Tesla. “Thailand is an option since it’ll give continuity of access to the supply chain that supports the Shanghai facility, but not regulated by Beijing.” 

This comes at a crucial juncture for new demand, with the U.S. administration significantly cutting back on EV tax credits available to consumers based on Chinese sourcing in the manufacturing process — though some critics say the rules are not strict enough. The Thai government offers its own subsidies and tax incentives to propel EV adoption and attract foreign manufacturers.

“There are fewer political implications of exporting vehicles from Thailand to markets like the U.S. or E.U. versus China,” said Seth Goldstein, equities strategist at Morningstar, who covers Tesla.

Why Detroit failed in China

While vehicles made in Thailand may not qualify for the Inflation Reduction Act subsidies, they are less likely to face steep tariffs that have been imposed on Chinese vehicles in the U.S., Goldstein said, and many market expects worry about tariffs which could increase even more if Donald Trump is reelected. A Trump reelection is not even necessary: the Biden administration may introduce 100% tariffs on Chinese EVs next week, according to reporting on Friday.

There’s also a very large market to sell into where U.S. tariffs won’t matter at all: the 650 million people in Southeast Asia that can directly access one of ASEAN’s largest automotive markets, according to Tu Le, founder of the Beijing-based consultancy Sino Auto Insights, who has worked from Detroit to China.

A more affordable Tesla

What’s called the “China Plus One” supply chain strategy is gaining momentum across industries amid geopolitical uncertainty and the ongoing U.S.-China trade spat — even before the latest reports, President Biden has been in many respects as hawkish as Trump on China.

However, the affordable mass-market vehicle that has so far eluded Tesla will be a key to achieving large sales volumes in the region. “A Model 3 or Y will still be too expensive for those markets to be high volume products for Tesla,” Le said. 

Tesla said in its recent earnings that is it accelerating the launch of “new vehicles, including more affordable models” — with plans for a highly anticipated $25,000 model by 2025. But the company also made clear that much of that will take place on current manufacturing lines before investing in any new facilities.

Notably, Tesla launched Model 3 and Model Y in Thailand in 2022, but has struggled against the onslaught of Chinese rivals like China’s BYD and Xiaomi that offer a wide range of products, from high-end to affordable. In fact, BYD manufactured over three million EVs in 2023, exceeding Tesla’s production for the second year in a row.

Models presenting the Chinese automaker’s electric car, the BYD Song MAX, at the 45th Bangkok International Motor Show 2024 in Nonthaburi Province, on the outskirts of Bangkok, Thailand, on March 30, 2024. 

Nurphoto | Nurphoto | Getty Images

Recent reporting from Nikkei Asia indicated that Tesla’s Model 3 sedan pricing has been cut 9% to 18% lower in Thailand, as its auto market joined the global slump and as BYD, Great Wall Motor, and other Chinese EV makers prepare to start their own production in the country. Chinese EV makers, including BYD, have earmarked $1.44 billion in new production facilities in Southeast Asia’s second-largest economy.

“The price war is not going to end very soon,” Naruedom Mujjalinkool at Krungsri Securities, told Nikkei Asia. 

Tesla Thailand recently rolled out a special financing program to spur more sales.

Thailand is a leading global automaker

Steven Dyer, a former Ford executive and managing director at the Shanghai-based arm of consulting firm AlixPartners, said Thailand’s existing auto infrastructure, labor force and policy all provide the potential for it to become a big player in EV manufacturing. But as important is automakers seeing enough of consumer market for locally made supply. In the auto industry, he said, a rule of thumb is “make where you sell,” which reduces freight and customs duty costs, and mitigates the risks of currency exchange.

Southeast Asia is a growing auto market, and Thailand is already the region’s biggest car producer and exporter, with Toyota, Honda, Nissan, Ford, GM and Mercedes-Benz having already embraced Thailand as a regional headquarters.

German President Frank-Walter Steinmeier (l) has an employee explain the production processes to him during a visit to the Mercedes-Benz plant near Bangkok. Mercedes-Benz produces 13 different car models in Thailand with over 1,000 employees. 

Picture Alliance | Picture Alliance | Getty Images

The country is striving to become a leading global manufacturing powerhouse through favorable tax benefits and import duties, but it also has a long way to go to convert current auto production to be EV-ready. By 2030, Thailand aims to convert 30% of its annual production of vehicles to EVs, which equates to 725,000 cars and 675,000 motorcycles — it is a market where motorbikes are also hugely important from both the manufacturing and consumer perspective.

Le says the country has an advantage, but will still have to play its cards right. “All ASEAN countries are looking to recruit EV manufacturers to their shores, but I’d say Thailand and Vietnam are two countries that hold an advantage over the others due to their automotive experience,” he said.

Leading legacy automakers, including Honda and Toyota, have committed a $4.1 billion to produce EVs in Thailand.

The Thai government is offering foreign EV manufacturers significant incentives, including up to 40% cuts on import duties and a reduced excise tax rate of 2% for fully assembled EVs imported in 2024 and 2025, provided they start producing in Thailand by 2027, according to Narit Therdsteerasukdi, secretary-general of the Thailand Board of Investment.

Dyer said if a U.S. automaker succeeds in faraway markets with EVs, “it brings familiarity of the various U.S. brands to more consumers, which often helps build momentum for other compatriot carmakers in those markets.”

Thailand’s discovery of nearly 15 million tonnes of lithium deposits — a current key in battery chemistry — could give the country another edge over Asian rivals in attracting EV makers.

“If Thailand becomes a market where EVs or their components can be cheaply produced and freely exported, then I’d imagine many larger EV producers would consider building operations in the country,” Goldstein said, including Tesla.

Risks for Musk’s EVs in Asia

There are risks for Tesla within Asia. Some experts have raised concern that if Tesla effectively competes with Chinese rivals in China and the broader Asian market, China could cut off Tesla’s access to low-price parts. Thailand’s emergence as a manufacturing hub would help cushion such a blow.

Moreover, “if Thailand-produced EVs would qualify for Inflation Reduction Act subsidies, then that would create a strong incentive to produce vehicles or batteries there to export,” Goldstein said.

As of now, the U.S. government rules are buying U.S. companies “time to design, develop, and manufacture more competitive EVs at reasonable prices,” Le said.

Yet, without a cheaper entry-level model, U.S. EV makers like Tesla may be hamstrung against Chinese rivals ramping up production and rolling out models across a much wider price range.

“Tesla can compete in luxury automotive segments by producing vehicles locally in China, but the U.S. as an EV market is well behind China,” Goldstein said.

Tesla’s anticipated $25,000 entry-level vehicle, dubbed the Model 2, could help turn the tide amidst a sales decline and fierce Chinese competition, but as with all things Tesla, promises and timelines lead the experts to remain cautious, if not outright skeptical. Le says Tesla may already be too late in an Asian market that has already become more competitive $11,000 Chinese EVs. “Europe and the U.S. still hold promise for an ‘affordable’ Tesla, but the significance for the Asian market will be much more limited because of ‘China EV Inc’,” he said.

That doesn’t mean it’s not a big opportunity: Goldstein believes an affordable Tesla model could help the company grow to five million deliveries in 2030, especially in the U.S. and EU, where Tesla can manufacture locally to avoid tariffs. It’s just not one that may favor a major play for the Southeast Asian consumer, even if the market is too large to ignore entirely.

“ASEAN and South Asia are key markets for Tesla’s future, but Chinese EV makers have really complicated their path to global dominance in the future,” Le said.

Chinese EVs already make up 60% of worldwide sales, according to International Energy Agency.

“The mystique of the Tesla brand has started to wear globally and it’s partly due to the fact that their best-selling products have been largely unchanged for three to four years,” Le said.

Related Topics:
Continue Reading

Environment

ECOVACS Goat RTK robot mowers start from $850 low, Rad Power RadWagon 4 cargo e-bike $1,499, EcoFlow solar bundle flash sale, more

Published

2 hours ago

on

July 30, 2025

By

ECOVACS Goat RTK robot mowers start from 0 low, Rad Power RadWagon 4 cargo e-bike ,499, EcoFlow solar bundle flash sale, more

This week’s hump day Green Deals start off with the ECOVACS Goat O1000 RTK Robot Lawn Mower returning to its $850 low for the third time ever, while its upgraded A2500 model is down at its second-lowest price too. From there, we have a spotlight on Rad Power’s popular RadWagon 4 Cargo e-bike at $1,499 while the brand’s Back to School Sale continues through to next week, as well as EcoFlow’s final 24-hour July Monthly Madness flash sale that is taking up to 55% off DELTA 2 Max and DELTA 3 Pro solar generator bundles starting from $1,349, while also offering an increased EcoCredits purchase option. We also have a returning low on the 80V Pro-grade Greenworks 18-inch chainsaw, a one-day-only discount on Anker’s SOLIX C300X DC power station with a book-sized 60W folding panel, and more waiting for you below. Plus, all the hangover savings at the bottom of the page, like yesterday’s Navee ST3 Pro electric scooter savings, Aiper’s HydroComm pool monitor hitting its lowest price for the second time, and more.

Head below for other New Green Deals we’ve found today and, of course, Electrek’s best EV buying and leasing deals. Also, check out the new Electrek Tesla Shop for the best deals on Tesla accessories.

Save up to 35% on ECOVACS’ Goat RTK robot lawn mowers with fisheye cameras starting from an $850 low

Amazon is offering the ECOVACS Goat O1000 RTK Robot Lawn Mower for $849.99 shipped, which beats out the brand’s direct website pricing by $50. This newer lawn care solution has only been on the market for five months and normally goes for $1,000 at full price, with discounts having mostly taken the price down to $900, aside from the two recent falls to the $850 low in May and June, while getting skipped over during Prime Day sales. This is the third time that we’ve seen this all-time low price appear with $150 cut from the tag price, and you’ll also find its upgraded counterpart benefitting from a discount below.

The ECOVACS Goat O1000 robot mower is the base model of the series designed to handle up to 1/4 of an acre of land on each full charge, with it able to stop, charge, and return to its duties for larger yards. Forget having to deal with laying boundary wires here, as it’s been given RTK navigation that provides more accurate location tracking on top of efficient route planning, with bolstered support from the LiDAR (3D-ToF) and fisheye camera that can take over steering when it enters heavily shaded or tree-lined areas that the satellites can’t see into. There’s also AIVI 3D obstacle avoidance tech, with the added bonus that it can also identify small animals alongside everyday inanimate objects around your yard – whether in the sun or in the dark.

Advertisement – scroll for more content

ECOVACS’ Goat robot mowers can fit into tighter spaces between fences and the like that a normal mower may struggle or fail to tackle well, thanks to the compact and narrow design of its body, with it even given an IPX6 waterproof construction should it need to tough out sudden weather changes as it works. There’s plenty of remote smart controls available via its companion app, giving you the means to adjust settings, monitor its real-time performance, and edit the 3D maps it creates.

There’s also the more advanced ECOVACS Goat A2500 RTK Robot Lawn Mower down at its second-lowest price of $1,299.99 shipped right now, down from its $2,000 price tag. This model comes with a 32V motor and dual-blade discs, with a 5Ah battery that allows it to cover up to 5,382 square feet of mowing on a single charge, which it can be ready to pick back up on after only 45 minutes of charging at its station. It brings much of the same smart capabilities for its navigation and obstacle avoidance as the above model, with the added bonus of responding to voice commands via Alexa or Google Assistant too.

woman riding Rad Power RadWagon 4 cargo e-bike with two children

As part of its ongoing Back to School Sale running through August 6, Rad Power Bikes is offering its RadWagon 4 Cargo e-bike at $1,499 shipped, alongside the ongoing low RadExpand 5 pricing and the new RadRunner e-bike bundles. This popular model fetches $1,799 at full price, which we’ve only seen dropped down to $1,599 over the last year, with more frequent returns to $1,499 in 2025 or otherwise given some bundled accessory packages. This is the lowest price we have tracked in the last two years, beaten out by the $1,399 post-launch low from 2023 and the all-time $1,299 preorder low from its launch years before.

If you want to learn more about this model, be sure to check out our original coverage of this e-bike here, while you can also browse the entire Rad Power Back to School Sale lineup here.

man aiming solar panel towards sun on leafy ground while plugged into EcoFlow DELTA 2 max portable power station

EcoFlow’s final July Monthly Madness flash sale takes up to 55% off DELTA 2 Max and DELTA Pro 3 bundles starting from $1,349

As part of the final days of its July Monthly Madness Sale running through July 31, EcoFlow has launched the last of this sale’s scheduled 24-hour flash sales through tomorrow at 9 a.m. PDT / 12 p.m. EST with up to 55% discounts on two solar generator bundles and an increased EcoCredits one-time purchase promotion. The most budget-friendly of the two bundles gives you the DELTA 2 Max Portable Power Station with a 400W solar panel at $1,349 shipped, and that price matches at Amazon too. This bundle would normally cost you $2,298 at full price, with discounts having mostly kept costs between $1,399 and $1,599 over the year, though we have seen it go as low as $1,279 during Prime Day. You’re looking at a 55% markdown here for the next 24 hours that saves you $949 at the third-lowest price we have tracked. Head below to learn more about this unit and the other offers during this sale.

If you want to learn more about this power station or the other offers during this 24-hour flash sale, be sure to check out our original coverage of these deals here.

man cutting log with Greenworks 80V 18-inch cordless chainsaw

Cover storm cleanup, firewood, more with Greenworks’ Pro 80V 18-inch cordless chainsaw at $199 low

Amazon is offering the Greenworks Pro 80V 18-inch Brushless Cordless Chainsaw with 2.0Ah battery at $199 shipped, while it’s priced at $229 directly from the brand’s website. It carries a $350 MSRP direct from Greenworks, but we have been seeing it more often at $299 at Amazon, with discounts mostly keeping things at $229 on average, with two previous falls to the $199 low, most recently during Prime Day three weeks ago. You’re looking at the best price we have tracked on this pro-grade model, giving you significant power for sawing needs with $100 cut from the tag (and $151 off the MSRP).

If you want to learn more about this pro-tier tool, be sure to check out our original coverage of this deal here.

man and woman camping during the day and night with Anker's SOLIX C300X portable power station solar bundle

Carry Anker’s SOLIX C300X DC power station with a book-sized 60W folding solar panel at $237 (Today only)

As part of its Deals of the Day, Best Buy is now offering the Anker SOLIX C300X DC Portable Power Station bundled with a 60W foldable solar panel for $236.99 shipped. While this model starts for $330 at full price here, it carries a lower $300 tag directly from the brand’s website, where it’s currently sitting untouched by discounts, while Amazon’s matching grey colorway is priced $23 higher. For most of 2025, while there have been price cuts, they generally hit $250, though it did drop a tad lower to $230 during Prime Day, as well as $220 in February, with everything beaten out by the $190 Black Friday low. For the rest of the day, you can pick up this solar generator bundle with $63 off the going rate ($93 off the Best Buy tag) at the third-lowest price of the year and fourth-best overall.

If you want to learn more about this compact solar generator bundle, be sure to check out our coverage of this one-day-only deal here.

Best Summer EV deals!

Best new Green Deals landing this week

The savings this week are also continuing to a collection of other markdowns. To the same tune as the offers above, these all help you take a more energy-conscious approach to your routine. Winter means you can lock in even better off-season price cuts on electric tools for the lawn while saving on EVs and tons of other gear.

FTC: We use income earning auto affiliate links. More.

Continue Reading

Environment

Ford says it will build ‘breakthrough’ EVs in the US

Published

2 hours ago

on

July 30, 2025

By

Ford says it will build 'breakthrough' EVs in the US

Ford-Q2-2025-earnings

Ford (F) reported Q2 2025 earnings on Wednesday, beating top and bottom line expectations. Despite the revenue growth, Ford is warning profits will take a hit thanks to Trump’s tariffs. We will also learn about Ford’s plans to build “breakthrough” EVs in the US very soon.

Ford Q2 2025 earnings preview

After suspending full-year guidance in May, Ford warned that it expected to take a $2.5 billion hit from Trump’s auto tariffs.

Given that Ford builds more vehicles in the US than any major automaker, outside of Tesla, it’s expected to see less of an impact from the 25% tariff on imports.

Ford imports just about 21% of the vehicles it sells in the US. In comparison, crosstown rival GM imports around 46%. GM announced last week that the tariffs cost it an extra $1.1 billion in the second quarter. For the full year, GM still expects a $4 billion to $5 billion impact.

Advertisement – scroll for more content

Unlike GM, Ford breaks down earnings into three units, including Model e, its electric vehicle business. Ford’s Model e posted a nearly $1 billion loss in the first quarter, but new EVs rolling out in Europe boosted revenue.

Although Ford’s vehicle sales rose 14% to over 612,000 in Q2, EV sales dropped 31% to just 16,438. Ford spokesperson Martin Gunsberg told Electrek that both the Mustang Mach-E and F-150 Lightning were impacted by the changeover to the 2025 model year and the Mach-E recall.

Ford-Q2-2025-earnings
Ford Mustang Mach-E (left) and F-150 Lightning (right) (Source: Ford)

According to Estimize, Wall Street expects Ford to post second-quarter EPS of $0.33 on revenue of $43.75 billion.

Improving costs and more EV news to come

Ford beat earnings estimates posting second quarter revenue a record $50.02 billion in revenue, up 5% YOY and an adjusted EPS of $0.37.

  • Ford Q2 2025 Revenue: $50.02 billion vs $43.75 billion expected
  • Ford Q2 2025 adjusted EPS: $0.37 vs $0.33 expected

Despite the higher revenue, Ford posted a $36 million net loss, which was due to a “field service action and expenses related to a previously announced cancellation of an electric vehicle program.” It also incurred an $800 million loss due to tariffs in the quarter.

Ford Pro continues to drive both top and bottom-line growth with high-margin revenue streams from software and services.

Its Model e EV business, on the other hand, lost another $1.3 billion in the second quarter. Through the first half of the year, Model e has now lost $2.2 billion.

Ford-Q2-2025-Earnings
Ford Model e Q2 2025 earnings (Source: Ford)

Ford attributed the higher losses to tariff-related costs and investments in launching its new EV battery plant in Michigan.

After launching new EVs in Europe, like the Capri and electric Explorer, Model e’s revenue doubled to $2.4 billion. Mustang Mach-E and F-150 Lightning material costs also improved in the quarter.

Ford-EVs-Europe
Ford’s electric vehicles in Europe from left to right: Puma Gen-E, Explorer, Capri, and Mustang Mach-E (Source: Ford)

Ford now expects full-year adjusted EBIT of $6.5 billion to $7.5 billion, including a $2 billion hit from tariffs. That’s down from the $7 billion to $8.5 billion it previously forecasted.

The company will partially offset a $3 billion gross adjusted EBIT impact, partially offset by $1 billion in recovery actions.

CEO Jim Farley announced an event on August 11 in Kentucky, where Ford will share more details about its “plans to design and build breakthrough electric vehicles in America.”

Check back for more info from Ford’s Q2 2025 earnings call. We will keep you updated with the latest.

FTC: We use income earning auto affiliate links. More.

Continue Reading

Environment

Tesla is about to lose the $7,500 EV tax credit – again – and this time the cliff is a lot steeper

Published

2 hours ago

on

July 30, 2025

By

Tesla is about to lose the ,500 EV tax credit – again – and this time the cliff is a lot steeper

Tesla family hero

Tesla is about to tumble off a familiar policy cliff. The $7,500 federal tax credit that juiced demand for electric vehicles in the US, Tesla’s last large, healthy market, after September 30, 2025. Tesla has been here before, but the ground underneath the company looks very different today.

Let’s dig into what happened last time, what’s changing now, and why Elon Musk is already warning shareholders of “tough quarters ahead.”

We have been here before. Tesla lost access to parts of the federal tax credit for electric vehicles in 2019 and lost it fully by 2020.

Flashback: the 2019 credit phase‑out was painful—but survivable

  • Trigger: Tesla crossed 200,000 cumulative US deliveries in July 2018, starting a timer that halved the credit to $3,750 on Jan 1, 2019, and again to $1,875 on Jul 1, 2019, before it went to zero on Jan 1, 2020.
  • Tesla’s playbook: On Jan 2, 2019 the company shaved $2,000 off the sticker of every Model S, X, and 3 to “partially absorb” the lost incentive.
  • Demand whiplash: The price cut wasn’t enough to avoid a huge pull‑forward. Deliveries spiked in Q4 2018, then fell 31 % QoQ in Q1 2019.
  • Fast recovery: Thanks to Model Y’s arrival and virtually zero credible EV competitors, Tesla ended 2019 with 367,500 global deliveries (‑US dip only 1 %) and roared back to 499,550 in 2020.

Last time, the phase-out was gradual, enabling Tesla to fill the hole with price cuts.

Advertisement – scroll for more content

Most importantly, the phase-out period coincided with the launch of Model Y, which never had full access to the federal tax credit, allowing Tesla to grow in the US without it.

The 2025 sunset hits everyone, but it hurts Tesla most

The situation in 2025 is vastly different. Firstly, the EV market has undergone significant changes in the US. Tesla is still the biggest brand, but it’s nowhere near where it was 5 years ago:

2020 cliff 2025 cliff
Who lost the credit? Only Tesla and GM Every OEM, but Tesla sells the most EVs
Competitive field < 15 mainstream EVs on sale > 60 credit‑eligible models in showrooms
Tesla US share ~75 % of EVs 46 % in Q1 2025 and sliding
Gross margin cushion ~22 % automotive ~17 % in Q1 2025 after a year of price cuts

Furthermore, the impact of the tax credit was greater in the latest version. The Biden administration reinstated Tesla’s access to the $7,500 tax credit for electric vehicles in 2022 through the Inflation Reduction Act (IRA).

However, it became even more attractive in 2024 when the government made it a “point-of-sale” incentive, which was applied directly to the vehicle’s price rather than as a rebate on taxes.

Going from that to nothing is expected to have a greater impact on demand for electric vehicles in the US.

What can Tesla do this time?

As last time, Tesla is expected to cut prices to compensate for the tax credit’s expiration.

However, Tesla has slimmer gross margins than it did previously, and it is not expected to be able to cut prices enough to compensate for the $7,500 price difference.

In addition to cutting prices, Tesla is expected to launch a stripped-down version of the Model Y with fewer features, which should significantly reduce the base price of its most popular model.

It should help with demand and avoid a greater reduction in Tesla’s production line capacity in Fremont and Austin, but with less value than the current versions of the Model Y, it is expected to cannibalize the more expensive versions of the best-selling vehicle mostly.

Key Take‑away 2018‑20 Phase‑out September 30 2025 Sunset (forward‑looking)
Trigger Tesla hit 200 000 cumulative U.S. EV deliveries in July 2018; credit stepped to $0 on 1 Jan 2020. Statutory clean‑vehicle credit (up to $7 500 new / $4 000 used) ends for all manufacturers on 30 Sep 2025 under the IRA sunset clause.
Immediate demand reaction Pull‑forward surges before each step‑down (Q4 2018, Q2 2019) followed by soft Q1 2019 deliveries (‑31 % QoQ). Dealers already advertising “buy before it’s gone,” and analysts expect a Q3 2025 bump.
Volume impact in the first full no‑credit year Tesla U.S. sales dipped only 1 % in 2019 and re‑accelerated +50 % in 2020 despite $0 credit, helped by Model Y launch and limited competition. Competitive landscape is radically different—Tesla’s U.S. EV share has slipped from 62 % in 2022 to 46 % in Q1 2025. Demand is more price‑sensitive.
Profit levers used $2 000–$3 000 price cuts, feature unbundling, and manufacturing scale offset lost credit. To replicate prior success Tesla would need deeper price moves or zero‑interest financing, pressuring gross margin already down ~650 bps YoY by Q1 2025.
Strategic cushion First‑mover advantage; few high‑volume rivals. 60+ eligible models from 17 brands compete in sub‑$60 k bracket; used‑EV market growing; interest‑rate environment still elevated.

Electrek’s Take

Shareholders should brace for the worst here. I know many of them have been holding on to the fact that Tesla did quite well after the removal of the tax credit last time, but as explained above, this time is entirely different.

The US has been Tesla’s only somewhat healthy market amongst the large automotive markets (US, Europe, and China). That’s because it is an uncompetitive market when it comes to electric vehicles.

Foreign EVs are not eligible for the tax credit, and Chinese EVs are subject to a 100% tariff.

The result is that Tesla was able to maintain a 45% (but declining) market share in the US EV market, compared to just 9% in Europe and 4% in China.

Now, demand for electric vehicles in the US is expected to crash.

Tesla CEO Elon Musk knows that he has warned that the automaker might face some “tough quarters” in “Q4 2025, and Q1 and Q2 2026.” After that, he expects Tesla to do well thanks to autonomous driving, but he has been consistently wrong about that for years.

I think the crash in demand will be accentuated in Q4 due to demand being pulled forward in Q3, which is likely to be Tesla’s last good quarter for a long time.

We are about to see Tesla’s sales decline, most likely sharply, in the US, while they have already crashed in Europe and are experiencing a decline in China due to intense competition.

FTC: We use income earning auto affiliate links. More.

Continue Reading

Trending