Starting October 1, electric vehicle sales could decrease south of our border.

US Senate could end electric incentives as early as September 30

no one had any doubt that Donald Trump's return to the White House meant the electric vehicle purchase incentive program's days would be numbered.

Under President Biden's Democratic administration, the program's end was planned for 2032. Early Republican announcements regarding its discontinuation aimed for the end of the current year.

Senate Republicans now hope to accelerate that by introducing a new provision in the bill surrounding the measure. They call for the program to end on September 30, which is less than three months away.

The current incentive in the U.S. grants a $7,500 rebate on the purchase of an eligible electric model. Half of that amount is applied to the purchase of a plug-in hybrid vehicle, while $4,000 is available for the acquisition of a used electric or plug-in model.

If the program's end is indeed brought forward, we will see a situation similar to what happened in Canada last January when the federal government suddenly announced the end of its program. Many dealerships had stocked up on EVs to meet their sales forecasts. With rebates eliminated and fewer customers, they found themselves with significant unsold inventory.

In the U.S., the National Automobile Dealers Association (NADA) is pleading with Congress to give retailers more time to clear their stock before incentives end. "Dealers still have significant EV inventory, with approximately 140,000 models currently on dealer lots. NADA is asking Congress to include a reasonable transition period.

Given how things have unfolded recently with the President's controversial mega-bill, which was ultimately passed, it's fair to expect that the one concerning the withdrawal of incentives will also pass. That means that electric vehicle sales could decrease south of the border starting in October.

Does this mean the future of electric models is compromised? No. In fact, incentives weren’t meant to remain in place forever. The goal is to create close to price parity between gas and electric models, until such time as there’s natural price parity.