The Great American EV Tax Credit Rush Has Begun

Gizmodo

5 days ago

The great EV buying frenzy has officially begun. In the last 48 hours, Tesla has seen delivery times for some of its most popular models skyrocket from a few weeks to nearly six months, a clear signal that consumers are stampeding to buy an electric vehicle before a crucial federal tax credit disappears for good.
This is the short-term sales boom that experts have been predicting, a last-chance gold rush for buyers. But for the EV industry, it's also a sugar rush that could lead to a brutal crash.
The cause of the chaos is the impending expiration of the federal EV tax credits. The credits—a key part of the Biden-era Inflation Reduction Act (IRA)—provided a $7,500 incentive for a new EV and $4,000 for a used one, significantly lowering the barrier to entry for many buyers. Losing them overnight makes many deals uneconomical, especially for first-time EV buyers.
Under the 'One Big Beautiful Bill' signed by President Donald Trump on July 4, those credits will officially end on September 30. After that date, the price of a new EV will effectively jump by $7,500 overnight.
Anticipating this, automakers have been bracing for a surge of consumers looking to lock in the savings. Now, the first signs from Tesla, the undisputed market leader, prove the experts were right.
As of Sunday, consumers placing an order for most variants of the Model 3 sedan and all variants of the best-selling Model Y SUV were given a delivery estimate of four to six months, a massive jump from the one-to-three-week estimate seen just two days prior, Gizmodo found. This indicates that Tesla's current inventory is being rapidly depleted by the surge in demand.
The long wait times are creating a high-stakes drama for buyers because of a critical rule: to qualify for the tax credit, you don't just have to order the car by the deadline, you must take delivery of it. This is a point Tesla and its CEO, Elon Musk, are now urgently emphasizing.
'$7,500 Federal Tax Credit ends Sept 30,' Tesla wrote on X this Sunday. 'You'll need to take delivery – not just place an order – by that date to make use of the credit before it's gone.'
Musk reposted the message, adding an even more alarming note: 'Important re-timing of vehicle delivery.' The message is clear: if you wait too long, you'll miss out.
Important re timing of vehicle delivery https://t.co/3Cbxie1ajE
— Elon Musk (@elonmusk) August 10, 2025With demand surging and customers growing desperate, Tesla is already capitalizing on the situation. Earlier this week, the company raised its Model Y lease pricing by up to 14% and ended a free upgrade incentive for both the Model Y and Model 3. Latecomers have must place their orders by August 11 for the Model Y and August 18 for the Model 3 to take advantage of it.
The sudden changes, made with no warning, have frustrated some buyers.
'I am sick to vomiting with Tesla doing this to pull demand when they can't do basic advertising/educating/public relations,' one user posted on X. 'Every other company does it. It was cute when Tesla was a startup no more.'
I am sick to vomiting with Tesla doing this to pull demand when they can't do basic advertising/educating /public relations.
Every other company does it. It was cute when Tesla was a startup not anymore. pic.twitter.com/VnkDnYAlLP
— Philip Imants Long 🛡️ (@Phil_I_Long) August 9, 2025This sales frenzy comes after a brutal second quarter for the automaker, which saw its deliveries fall 13.5% and its net revenue drop 16.3% compared to the previous year as it grappled with brand damage from Musk's political activities.
While the current buying rush is a welcome short-term boost for Tesla's bottom line, many analysts believe it is simply 'pulling forward' demand from the fourth quarter and beyond. The real test will come on October 1, when the EV market will have to stand on its own for the first time in years, without the help of a massive government incentive.