Ford CEO Jim Farley Warns of Steep EV Sales Drop Post-Tax Credit Expiration
On September 30, 2025—the final day for consumers to claim the federal EV tax credit—Ford Motor Co. CEO Jim Farley delivered a sobering forecast for the electric vehicle market. Speaking at the company’s “Ford Pro Accelerate” event in Detroit, which focused on skilled trades and the “essential economy,” Farley predicted that U.S. EV sales could plummet by half in the coming month, dropping from an expected 10-12% market share in Q3 to around 5%. This comes as President Donald Trump’s “One Big Beautiful Bill Act” (OBBB), signed earlier this year, accelerates the end of the $7,500 per-vehicle consumer tax incentive, originally set to run through 2032 under the Inflation Reduction Act.
The Policy Shift and Its Immediate Trigger
The OBBB not only sunsets the EV tax credits at the end of Q3 2025 but also eliminates related incentives for U.S. EV manufacturing and rescinds penalties for non-compliant automakers on tailpipe emissions standards. This dual blow—removing buyer subsidies and easing regulatory pressure—marks a sharp reversal from Biden-era policies that fueled EV adoption. Farley emphasized the unpredictability: “We had a four-year predictable policy. Now the policy changed,” highlighting the need for Ford to reassess its battery plants and EV production capacity.
Buyers have rushed to capitalize on the credit, with Cox Automotive projecting a record 410,000 EV sales in Q3—up 21% year-over-year and capturing 10% of the U.S. auto market. August alone saw a 20% surge to over 130,000 units, as consumers pulled forward purchases. Post-expiration, analysts like those at Cox and Wedbush Securities anticipate a “pull-forward” hangover, with sales potentially stabilizing at 4-5% market share in the near term—half of recent levels.
Farley’s Full Remarks and Broader Industry Context
Farley described the EV sector as “vibrant” but “way smaller than we thought,” attributing the contraction to the loss of incentives alongside persistent challenges like high upfront costs (e.g., $75,000+ for many models) and limited charging infrastructure. He noted customer preferences lean toward “partial electrification” options, such as hybrids, which offer familiarity without full commitment to battery-only driving. For instance, Ford’s hybrid F-150 now accounts for a third of U.S. truck sales, providing perks like onboard generators for home or job-site power.
Ford’s Model e EV division is monitoring daily demand signals, but the CEO stressed adaptation: “We have to make these partially electric vehicles in the factories that would have been EVs.” This pivot aligns with Ford’s earlier signals of scaling back aggressive EV targets amid losses—its EV unit reported a $3 billion pretax hit in 2024—and echoes sentiments from rivals like GM, whose North America VP Duncan Aldred warned of a “smaller EV market for a while” without overproduction.
| Key EV Market Metrics (U.S.) | Q3 2025 Projection | Post-Credit Estimate (Q4 2025) | Year-Over-Year Change |
|---|---|---|---|
| Sales Volume | 410,000 units | ~200,000-250,000 units | -40% to -50% |
| Market Share | 10-12% | 4-5% | -50% |
| Pull-Forward Impact | +21% YoY | Normalization in months | N/A |
(Data synthesized from Cox Automotive and Wedbush forecasts)
Reactions and Market Ripple Effects
The news has amplified debates on X, where users from conservative circles hailed it as validation for ending “green new scam” subsidies propped up by taxpayer dollars. Others, including financial watchers, shared the CNBC article directly, underscoring the urgency as the credit window closes today. Skeptics mocked the revelation as obvious, with one user quipping they could’ve predicted it “two years ago and saved the automakers billions.”
Broader implications include potential price hikes (effectively +$7,500 without credits), strained supply chains for U.S.-built EVs facing Chinese competition, and a manufacturing talent gap—Ford cited a shortage of 600,000 workers in related sectors. Tesla, GM, and Ford stocks dipped modestly in after-hours trading on the announcement, reflecting investor jitters over the “EV armageddon” scenario.
Despite the gloom, Farley remains optimistic about long-term electrification, urging innovation in affordable models and hybrids as a “bridge.” As Q4 data rolls in, the true test will be whether this cliff is temporary or a sign of deeper market resistance without government backstops. For now, it’s a reality check for Detroit: EVs aren’t dead, but they’re not charging ahead unchecked.