EV Tax Credit Rush Drives U.S. Auto Sales Up 6% in Q3 2025

U.S. auto sales accelerated in the third quarter of 2025, climbing nearly 6% year-over-year to around 4.14 million vehicles, according to industry data. The strong performance was largely fueled by a last-minute surge in electric vehicle (EV) purchases as consumers rushed to take advantage of the $7,500 federal EV tax credit, which officially expired on September 30.

Major automakers benefited from the buying frenzy. General Motors reported a 7.7% increase in U.S. sales, powered by demand for its expanding EV lineup and popular SUVs. Tesla also enjoyed record quarterly deliveries, while Ford saw solid growth in hybrid and electric models. Traditional gas-powered SUVs and pickup trucks continued to dominate the market, helping offset slower sedan sales.

However, analysts warn the momentum could fade in the coming months as vehicle prices and interest rates remain elevated. The average new car price reached $45,795, up more than $1,300 from last year, while higher financing costs are squeezing affordability for many buyers. Supply chains have stabilized compared to pandemic-era disruptions, but rising input costs and tariff pressures could still impact profit margins.

Looking ahead, automakers are expected to rely on in-house incentives and regional rebates to sustain demand now that federal EV credits are gone. The market is shifting toward efficiency and electrification, yet the next few quarters will test whether the EV boom can hold without government stimulus.

In short, Q3 2025 marked a high-octane quarter for U.S. automakers — a final lap of tax credit-fueled growth before a potentially slower road ahead.