GM HAD A RECORD MONTH OF EV SALES. A ‘COLLAPSE’ IS COMING.

General Motors reported a big month selling electric vehicles in the U.S., giving the market a piece of good news underpinned by bad news.

While the company typically reports its U.S. sales quarterly, it broke with tradition on Tuesday, saying it sold more than 21,000 all-electric cars in August. It was “an all-time monthly record in August, as customers rushed to make purchases ahead of the expiration of Federal EV tax credits,” GM said in a news release.

GM has several popular EV models, including the Chevy Equinox, Cadillac LYRIQ, and GMC Sierra pickup truck. In the second quarter, GM sold about 46,000 EVs, or just over 15,000 a month.

The federal EV tax credit is worth up to $7,500 per qualifying vehicle. The credit, however, goes away at the end of September, as specified in President Donald Trump’s recently passed tax-and-spending bill.

Americans bought 310,839 all-electric cars in the second quarter, down 6.3% from a year earlier. “Lower EV sales…underscore the market’s ongoing challenges, as growth in the auto business ebbs and flows on consumer demand,” said Stephanie Valdez Streaty, a senior analyst at Cox Automotive, in a report looking back at the second quarter.

Cox expects EV sales to grow in the third quarter as people buy before the credit is removed. “Q3 will likely be a record, followed by a collapse in Q4, as the electric vehicle market adjusts to its new reality,” Valdez Streaty wrote.

The loss of what amounts to a coupon cutting $7,500 from the price of an EV is significant for car buyers. The average transaction price for a new EV was $55,689 in July, according to Kelly Blue Book, but consumers using the credit would have paid $48,189. The average transaction price for all new cars was $48,841 in July.

Americans, it seems, are willing to go green as long as it doesn’t cost more. That points to EV price cuts that will harm profitability in the coming months.

Ford Motor, which is unusual in disclosing the profitability of its EV business for investors, shows the current state of things. Its EV operation lost $1.3 billion in the second quarter, but the per-car loss—operating profit divided by unit sales—diminished. It declined to roughly $22,000 per car from $44,000 a year ago.

Reducing those losses will be harder without the credit.

GM stock dropped 0.1% on Monday to $58.53, while the S&P 500 and Dow Jones Industrial Average lost 0.7% and 0.6%, respectively. Tuesday’s drop left shares up about 10% year to date.

Write to Al Root at [email protected]

2025-09-02T19:58:03Z