So much for Ford and GM’s scheme to extend the EV tax credit

Last week, it was revealed that automakers were working with their respective dealer networks on short-term programs that would allow customers to continue to benefit from the leased electric vehicle tax credit through the rest of the year. With the tax credit expiring on September 30, Ford and GM hoped to continue offering the discount to customers for a short time to boost electric vehicle sales.

While automakers including Hyundai and Stellantis have offered cash incentives to close the gap between buyers, Ford and GM have taken a different approach. They sought to purchase electric vehicles from their own dealerships by requiring their finance divisions to make down payments on all electric models in their inventory before the tax credit expired. Dealers would then lease the vehicles to customers with a $7,500 discount built into the price.

But now that plan is essentially moot. GM dropped out first on Wednesday, followed by Ford, according to Reuters. GM chose to end the plan after Republican Senators Bernie Moreno (Republican of Ohio) and John Barrasso (Republican of Wyoming) reported the plan to the Treasury Department, calling it a “flaw” and “a complete violation of Congressional intent by these nefarious actors.” Despite this, Ford and GM approved their plan with the Internal Revenue Service, according to Reuters.

Automakers hoped to soften the blow to car buyers and maintain the momentum many dealerships have seen in recent weeks. Electric vehicle sales soared in July and August as buyers rushed to claim the credit before it expired on September 30. Experts predict that now that credit is gone, sales of electric vehicles are likely to plummet.