WASHINGTON — Virginia car dealerships might be busy in the next few months with customers interested in electric vehicles.
Federal tax incentives are being eliminated sooner than originally scheduled and a regional consultant laid out where the industry is headed, along with buying tips.
Under the new tax policy law pushed by the Trump administration, enhanced tax credits bringing down the cost of a new or used electric vehicle end Sept. 30. They were originally planned to run through 2032.
Jukka Kukkonen, chief EV educator and strategist for the EV consulting firm Shift2Electric, said it could hinder adoption rates in the U.S., but there’s still global demand to transition away from gas-powered cars.
“In general, electric transportation will be the future, there’s no question about it,” Kukkonen emphasized. “We are letting the other competitors to gain a higher market share outside (the U.S.).”
He pointed out American auto manufacturers will be at a disadvantage as China and Europe make gains and failing to push for EV adoption will keep transportation as the top carbon pollution source in the U.S.
Experts also predict a rush of EV customers before tax incentives expire, which Kukkonen noted could limit inventory. A buyer has to have possession of the car by the end date for the tax credit to apply.
The credits are up to $7,500 for qualifying new EVs, and up to $4,000 for used models. They can be transferred to the dealer to immediately knock down the purchase price, instead of waiting until tax season.
Whether you meet the deadline, Kukkonen stressed there is a body of research showing EVs are more efficient cars than traditional engines, providing long-term savings. Battery technology has improved, too.
“Nowadays, the average range for (a) new EV is over 280 miles,” Kukkonen underscored. “Even if you lose 25% of that range in the wintertime, you still have over 200 miles of range.”
The Biden administration gave states money to build charging stations along interstates to address “range anxiety” for longer trips. However, the Trump administration paused the funding, with transportation officials arguing the program was poorly designed. A judge last month ordered the funding to resume.
If you plan to use a tax credit, Kukkonen recommended selecting a lease option to keep monthly payments lower.
