For months, Ford Motor CEO Jim Farley warned anyone who would listen that the electric vehicle transition was about to hit a wall, starting in September, when he predicted that the expiration of federal tax credits would cut the EV market in half. He said EVs would remain a “vibrant industry” but predicted they were “going to be smaller, way smaller than we thought.”
The turning point was what Farley called a “game changer”: the end of the $7,500 consumer incentive from the federal government, something that Farley saw cutting EV sales in the U.S. down to 5% of the industry from the current level of roughly 10% to 12%. (JD Power estimated that EVs represented 6.6% of new retail sales in January, suggesting the total picture is very close to what Farley predicted.)
