A new report published by Bloomberg New Energy Finance (NEF) forecasts that just over half of US car sales in 2030 will be electrified models. The publication points specifically to the Biden administration's recent Inflation Reduction Act, which includes a new federal EV tax credit. Biden has also moved forward with many other pieces of legislation that will help with EV charging infrastructure, and more.
BloombergNEF puts particular emphasis on the fact that the new EV tax credit will be a point-of-sale credit, meaning new EV buyers can take advantage of the savings at the time of purchase rather than waiting until tax season to get their money back. People buying an EV in the US going forward will be eligible for a $7,500 tax credit, though there are many specific rules related to the credit, so you should talk with a tax professional before committing to a purchase.
The publication previously projected that EV sales by 2030 would be about 43 percent of the total US car market. However, in August, after the most recent EV-related legislation passed, BloombergNEF changed its forecast to say that electric cars will now make up 52 percent of the total car market by 2030.
We do have to be careful with the wording here. Bloomberg and Automotive News both mention EVs often in the story, though the BloombergNEF forecast says "electrified" models, which typically includes plug-in hybrid electric vehicles (PHEVs) and sometimes traditional hybrids (no plug). PHEVs stand to benefit from the new EV tax credit in a big way, so it would make sense that BloombergNEF would include them in its forecast.
President Biden previously set a goal of the end of the decade for half of all car sales in the US to be battery-electric, plug-in hybrid electric, or hydrogen fuel cell-powered. If BloombergNEF is accurate with its forecast, the US could actually achieve the goal on time.
While it's hard to forecast EV adoption, many recent reports have been quite promising. It seems like it's going to take some time for the new EV tax credit to truly reveal its benefits since the rules will make it difficult for many electric cars to be eligible, at least for now. However, it makes sense that it would all level out in time for the US to realize its long-term targets. Corey Cantor, electric car analyst at BloombergNEF explained:
“In the next year or so, there shouldn't be too much of a difference [in sales]. Later in the decade, we expect not only the EV tax credit but the battery production tax credit to drive a steeper decline in EV costs.”
