The adoption of plug-in electric vehicles in the United States is variously supported and harmed by the American federal government, and states and local governments.
, cumulative sales in the U.S. totaled 4.7 million plug-in electric cars since 2010, led by all-electric cars. Sales totaled 1,402,371 units in 2023, with a market share of 9.1%. This was the first time the American market surpassed the 1 million sales mark. The American stock represented 20% of the global plug-in car fleet in use by the end of 2019 and the U.S. had the world's third largest stock of plug-in passenger cars after China (47%) and Europe (25%). See Statistical annex, pp. 247–252 (See Tables A.1 and A.12). The global stock of plug-in electric passenger vehicles totaled 7.2 million cars at the end of 2019, of which, 47% were on the road in China. The stock of plug-in cars consist of 4.8 million battery electric cars (66.6%) and 2.4 million plug-in hybrids (33.3%). In addition, the stock of light commercial plug-in electric vehicles in use totaled 378 thousand units in 2019, and about half a million electric buses were in circulation, most of which are in China. New-vehicle sales are expected to reach 16.3 million units in 2025, marking the highest volume since 2019 and a modest rise from 2024’s 16.0 million units.
The U.S. market share of plug-in electric passenger cars increased from 0.14% in 2011, to 0.66% in 2015, to 1.13% in 2017, 2.1% in 2018, slightly declined to 1.9% in 2019, Plug-in electric car sales in the U.S. totaled 194,479 units in 2017, consisting of 104,487 all-electric cars and 89,992 plug-in hybrids. The plug-in car segment achieved a market share of 1.13% of new car sales. rose to 2.2% in 2020, 4.0% in 2021, 6.8% in 2022, and achieved a record 9.1% in 2023. California is the largest regional market in the country, with 1 million plug-in cars registered by November 2021, 46% of the national stock.
, the Tesla Model 3 all-electric car is the all-time best selling plug-in electric car with an estimated 395,600 units delivered, followed by the Tesla Model S electric car with about 172,400, and the Chevrolet Volt plug-in hybrid with 157,125 units of both generations. At the end of 2019, the all-time top selling plug-in cars in the U.S. were the Tesla Model 3 with 300,471 units, the Tesla Model S with 157,92, and the Chevrolet Volt with 157,054 units. The Model S was the best selling plug-in car in the U.S. for three consecutive years, from 2015 to 2017, "Tesla sold its 200,000 Model S in the fourth quarter of 2017, in October or early November, becoming the second plug-in car to cross this sales threshold after the Nissan Leaf (300,000 units by early 2017). , Tesla reported global sales of 212,874 Model S cars." and the Model 3 also has topped sales for three years running, from 2018 to 2020. See Chart: "2019 Monthly/Q4 Sales Chart : Annual" - Cumulative sales in the U.S. totaled 329,528 units in 2019, and the top selling models were the Tesla Model 3 with 158,925 units, the Toyota Prius Prime with 23,630, the Tesla Model X with 19,225, the Chevrolet Bolt EV with 16,418 and the Tesla Model S with 14,100 units.
The Energy Improvement and Extension Act of 2008 and later the Inflation Reduction Act granted federal tax credits for new qualified plug-in electric vehicles, worth up to . , Washington, D.C. and 37 states and had established incentives and tax or fee exemptions for BEVs and PHEVs, or utility-rate breaks, and other non-monetary incentives such as free parking and high-occupancy vehicle lane access.
Overview by state Articles about plug-in electric vehicles in individual states:
Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming
Government support
In his 2011 State of the Union address, President Barack Obama set the goal for the U.S. to become the first country to have one million electric vehicles on the road by 2015. This goal was established based on forecasts made by the U.S. Department of Energy (DoE), using production capacity of PEV models announced to enter the U.S. market through 2015. The DoE estimated a cumulative production of 1,222,200 PEVS by 2015, and was based on manufacturer announcements and media reports accounting production goals for the Fisker Karma, Fisker Nina, Ford Transit Connect, Ford Focus Electric, Chevrolet Volt, Nissan Leaf, Smith Newton, Tesla Roadster, Tesla Model S and Th!nk City.
Considering that actual PEV sales were lower than initially expected, as of early 2013, several industry observers have concluded that this goal was unattainable. Obama's goal was achieved only in September 2018.
In 2008, San Francisco Mayor Gavin Newsom, San Jose Mayor Chuck Reed and Oakland Mayor Ron Dellums announced a nine-step policy plan for transforming the Bay Area into the "Electric Vehicle (EV) Capital of the U.S.". Other local and state governments have also expressed interest in electric cars.
Governor of California Jerry Brown issued an executive order in March 2012 that established the goal of getting 1.5 million zero-emission vehicles (ZEVs) on California roads by 2025.
American Recovery and Reinvestment Act
President Barack Obama pledged billion in federal grants to support the development of next-generation electric vehicles and batteries. $1.5 billion in grants to U.S. based manufacturers to produce highly efficient batteries and their components; up to $500 million in grants to U.S. based manufacturers to produce other components needed for electric vehicles, such as electric motors and other components; and up to $400 million to demonstrate and evaluate plug-in hybrids and other electric infrastructure concepts—like truck stop charging station, electric rail, and training for technicians to build and repair electric vehicles (green collar jobs).
In March 2009, as part of the American Recovery and Reinvestment Act, the U.S. Department of Energy announced the release of two competitive solicitations for up to $2 billion in federal funding for competitively awarded cost-shared agreements for manufacturing of advanced batteries and related drive components as well as up to $400 million for transportation electrification demonstration and deployment projects. This initiative aimed to help meet President Barack Obama's goal of putting one million plug-in electric vehicles on the road by 2015.
Tax credits
New plug-in electric vehicles
Federal incentives
First the Energy Improvement and Extension Act of 2008, and later the American Clean Energy and Security Act of 2009 (ACES) granted tax credits for new qualified plug-in electric drive motor vehicles. The American Recovery and Reinvestment Act of 2009 (ARRA) also authorized federal tax credits for converted plug-ins, though the credit is lower than for new plug-in electric vehicle (PEV).
As defined by the 2009 ACES Act, a PEV is a vehicle which draws propulsion energy from a traction battery with at least 5 kwh of capacity and uses an offboard source of energy to recharge such battery. The tax credit for new plug-in electric vehicles is worth plus for each kilowatt-hour of battery capacity over 5 kwh, and the portion of the credit determined by battery capacity cannot exceed . Therefore, the total amount of the credit, between and , will vary depending on the capacity of the battery (4 to 16 kWh) used to power the vehicles.
The qualified plug-in electric vehicle credit phases out for a plug-in manufacturer over the one-year period beginning with the second calendar quarter after the calendar quarter in which at least 200,000 qualifying plug-in vehicles from that manufacturer have been sold for use in the U.S. Cumulative sales started counting sales after December 31, 2009. After reaching the cap, qualifying PEVs for one quarter still earn the full credit, the second quarter after that quarter plug-in vehicles are eligible for 50% of the credit for six months, then 25% of the credit for another six months and finally the credit is phased out. Both the Nissan Leaf electric vehicle and the Chevrolet Volt plug-in hybrid, launched in December 2010, are eligible for the maximum $7,500 tax credit. The Toyota Prius Plug-in Hybrid, released in January 2012, is eligible for a tax credit due to its smaller battery capacity of 5.2 kWh. All Tesla cars and the Chevrolet Bolts and BMW i3 BEV are eligible for the tax credit.
A 2016 study conducted by researchers from the University of California, Davis found that the federal tax credit was the reason behind more than 30% of the plug-in electric sales. The impact of the federal tax incentive is higher among owners of the Nissan Leaf, with up to 49% of sales attributable to the federal incentive. The study, based on a stated preference survey of more than 2,882 plug in vehicle owners in 11 states, also found that the federal tax credit shifts buyers from internal combustion engine vehicles to plug-in vehicles and advances the purchase timing of new vehicles by a year or more. Published on line 2008-02-11.
In July 2018, Tesla Inc. was the first plug-in manufacturer to pass 200,000 sales and the full tax credit will be available until the end 2018, with the phase out beginning in January 2019. General Motors combined sales of plug-in electric vehicles passed 200,000 units in November 2018. The full tax credit will be available until the end of March 2019 and thereafter reduces gradually until it is completely phase out beginning on April 1, 2020. In order of cumulative sales, , Nissan has delivered 126,875 units, Ford 111,715, Toyota 93,011 and the BMW Group 79,679 plug-in electric cars.
A January 2024 study from the University of Michigan Center for Sustainable Systems found that the $7,500 tax credit and other federal incentives were needed to make BEVs cost competitive with ICEVs in many locations and for many vehicle classes.
State incentives
, 37 states and Washington, D.C. have established incentives and tax or fee exemptions for BEVs and PHEVs, or utility-rate breaks, and other non-monetary incentives such as free parking and high-occupancy vehicle lane access regardless of the number of occupants. In California, for example, the Clean Vehicle Rebate Project (CVRP) was established to promote the production and use of zero-emission vehicles (ZEVs). Eligible vehicles include only new Air Resources Board-certified or approved zero-emission or plug-in hybrid electric vehicles. Among the eligible vehicles are neighborhood electric vehicles, battery electric, plug-in hybrid electric, and fuel cell vehicles including cars, trucks, medium- and heavy-duty commercial vehicles, and zero-emission motorcycles. Vehicles must be purchased or leased on or after March 15, 2010. Rebates initially of up to per light-duty vehicle, and later lowered to up to , are available for individuals and business owners who purchase or lease new eligible vehicles. Certain zero-emission commercial vehicles are also eligible for rebates up to . California's zero-emission (ZEV) regulations are anticipated to result in 1.5 million electric vehicles on the road by 2025 ( i.e., 15% sales of total states in 2025); moreover, California's mixed incentives means to reach 40% of electric vehicle sales in the entire U.S.
Electric vehicle purchases made in the U.S. are eligible for $2,500 to $7,500, depending on the make and model of the vehicle, in federal tax credit.
The following table summarizes some of the state incentives: