GM scraps $7,500 EV tax credit program, but it has a new way to keep prices down

GM is ending plans for a program that enabled its dealers to extend the $7,500 tax credit for new Chevy, GMC, and Cadillac EV leases beyond the September 30 deadline. Instead, it has another plan to keep the savings going.

GM ends $7,500 EV tax credit and plans its own savings

After the $7,500 federal tax credit for electric vehicles expired at the end of September, GM was among the automakers planning to extend the incentive through leasing.

That will no longer be the case after the automaker suddenly reversed its decision. According to Bloomberg, GM will not extend the credit for EVs that were in transit to dealers ahead of the September 30 deadline.

Instead, GM will provide about $6,000 from its own pockets for a limited time to continue supporting electric vehicle leases.

A company spokesperson confirmed that “GM worked on an extended offer for the benefit of our customers and dealers,” adding “After further consideration, we have decided not to claim the tax credit.”

The savings will last until the end of the month. The spokesperson said in an email that “GM will fund the incentive lease terms through the end of October.”

GM and Ford announced programs last week that involved buying EVs through their financing units, which would enable them to qualify for the $7,500 tax credit. The companies would then use the funds to extend the credit through leasing.

A source close to the matter told Reuters that GM decided to end the program after Republican Senator Bernie Moren urged the end of the loophole that enabled the $7,500 credit to be passed on through leasing.

The announcement comes after GM delivered a record of over 66,500 electric vehicles in the third quarter. Through September, GM sold 144,668 EVs, more than double the amount it sold in the same period in 2024.

The Chevy Equinox EV is now the best-selling non-Tesla EV in the US, while Cadillac ranked as the top luxury electric vehicle brand in Q3.

Ford, Jeep maker Stellantis, and BMW are still planning to extend the credit for those EV leases for at least another few months. GM was expected to extend the offer until the end of the year.

GM already has one of the most affordable EVs in the US with the Chevy Equinox EV starting at under $35,000. In 2026, it will face a wave of new lower-priced EVs, including the new Nissan LEAF, which will start at under $30,000. General Motors is betting on more affordable EVs, including the 2027 Chevy Bolt, to gain a bigger share of the market over the next few years.

Interested in testing out one of GM’s electric vehicles for yourself? From the Chevy Equinox EV to the Cadillac Escalade IQ, you can use our links below to see what’s available near you.

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