General Motors to record $1.6 billion loss as EV tax credit ends
GM will be forced to scale back its investment in electric vehicles, taking a $1.6 billion hit as the U.S. ends the EV tax credit and eases emissions regulations.
scripps news
- California is introducing new electric vehicle rebates to replace lost federal tax credits.
- The new state incentive will be limited to first-time electric vehicle buyers.
- The program has caps on vehicle prices and buyer incomes.
California is moving to recoup at least some of the $7,500 federal electric vehicle tax credit it lost last year to President Donald Trump’s administration and Congress. But the state plans to limit the new incentives to first-time EV buyers.
As first reported by USA TODAY, California plans to spend $200 million in state funds to create an “on-the-bond” electric vehicle tax rebate that would provide instant discounts on EVs in the state with the most plug-in models in the nation.
But the California Air Resources Board, which regulates air pollution and vehicle emissions in the nation’s most populous state, said the new incentive program is only available to first-time EV buyers. The agency said other limits would include caps on the price of electric vehicles, similar to the limits placed on federal credits in the 2022 law.
What does California’s EV tax rebate mean for car buyers?
California has the highest percentage of car buyers choosing electric vehicles.
EVs and hybrids accounted for 26.3% of new light vehicle registrations in California in the third quarter of 2025, according to the Coalition for Automotive Innovation, which lobbies most major automakers in Washington, the latest data released by the group. The only other states with market share above 20% in Q3 2025 were Colorado, Washington State, and Washington DC.
Automakers have lamented the loss of federal incentives for electric vehicles, and some have cut back on plans to make future electric models in light of changes in federal support for the technology.
How many EV tax rebates has California given out so far?
In the previous Clean Vehicle Rebate Project, which ran from 2013 to 2024, California spent $1.49 billion to provide rebates on more than 586,000 electric vehicles. CARB said the previous EV tax credit had the following environmental benefits:
- Over 11 million tons of carbon dioxide equivalent (CO2e) reduction
- Reduced nitrogen oxides (NOₓ) by more than 1,100 tons
- Reduced particulate matter (PM) by more than 460 tons
- Over 456 million gallons of fuel avoided
What other limits does California have on EV tax refunds?
California plans to replicate the EV price limits that were included in the previous federal tax credit.
The limits would be:
- $55,000 for a new passenger car
- $80,000 for vans, SUVs, and pickup trucks
- $25,000 for used cars
CARB said automakers participating in the rebate program will be required to match state contributions, effectively doubling the incentives available to EV buyers, the agency said.
CARB said the decision to limit eligibility to first-time EV buyers will help “expand the market by introducing (zero-emission vehicle) technology to new consumers.”
“Research shows that once consumers switch to a ZEV, they typically do not go back to dirty gasoline or diesel cars,” the agency said.
