Tesla recently issued a warning to customers regarding the impending end of the $7,500 EV tax credit for new electric vehicles and the $4,000 credit for used EVs. These tax credits, which have been instrumental in making EVs more affordable, are set to be eliminated at the end of Q3. This move was always part of the plans of the Trump Administration, and now we are in the final quarter of their existence.
As a result, EV companies, including Tesla, are scrambling to find ways to reduce costs or make their vehicles more affordable for customers. The loss of the $7,500 tax credit will likely price many consumers out of the EV market, and Tesla is not immune to this challenge.
In response to the impending end of the tax credits, Tesla has rolled out a series of incentives for customers in Q3. These incentives include 0% APR on select purchases, lease deals, free upgrades on certain inventory units, and more. The company has made it clear that the list of incentives will not be expanding any further.
During Tesla’s recent Earnings Call for the second quarter of 2025, company executives emphasized the importance of placing orders early in the quarter to take advantage of the incentives. CFO Vaibhav Taneja confirmed that the incentives for the quarter have already been released and urged customers to act quickly due to limited vehicle supply in the US.
Tesla will only be able to apply the $7,500 tax credit to deliveries completed before the end of September. Even if an order is placed before then, delivery must be finalized by September 31 to qualify for the credit. Taneja stressed the importance of acting promptly, stating, “If you are in the US and looking to buy a car, let’s roll now as we may not be able to guarantee delivery for orders placed in the later part of August and beyond.”
The loss of these incentives will impact all EV manufacturers in the United States. Tesla has outlined its plan for the future, noting that more affordable models will be introduced in Q4. The company has strategically chosen this timing to avoid negatively impacting sales of existing models like the Model 3 and Model Y.
In conclusion, the impending end of the EV tax credits has prompted Tesla to offer a range of incentives to customers in Q3. These incentives are designed to encourage early orders and ensure delivery before the credits expire. Customers interested in purchasing a Tesla vehicle are advised to act quickly to take advantage of these limited-time offers.