FI showroom red and grey logo
MenuMENU
SearchSEARCH

Tax Credit Picture Could Throw a Wrench in Used Market

Breaks to bring a deluge of returning leases, but their uncertain future could imbalance supply and demand.

November 7, 2024
Tax Credit Picture Could Throw a Wrench in Used Market

Returning EV leases are expected to jump in 2026 by 230%, J.D. Power forecasts. 

Credit:

Pixabay/Joenomias

2 min to read


Federal tax credits for electric-vehicle leases that qualified many models not eligible for the breaks if purchased have spawned a large volume of EVs set to pump up the used-vehicle market.

J.D. Power research indicates leases of new EVs skyrocketed 355% last year in a trend that continued this year, albeit at a much slower pace, up 88% through September. The spike has been even more pronounced for franchise sales alone, up 438% last year, excluding Tesla sales, and up 109% this year through September.

Ad Loading...

That’s in sharp contrast to leases of gas-powered vehicles, which are still down from levels seen before the pandemic and therefore poised to contribute to used-vehicle shortages next year and in 2026, J.D. Power said. In fact, it said gas-powered and EV lease returns combined are down 37% from 2020.

The unusual EV lease activity, though, should at least help shore up overall used availability. Returning EV leases are expected to jump in 2026 by 230%, J.D. Power forecasts. 

Complicating the used supply picture, though, is the question of whether the federal EV credits will continue under the incoming Trump administration, since Trump has said he will eliminate EV adoption and production incentives. It’s also unclear if automakers will continue incentives.

Those questions, combined with consumer concern about long-term EV battery life, could bring new instability to the used market, J.D. Power said, complicating “the traditional balance of supply and demand.”

LEARN MORE: Nonluxury EV Segment Is Telling

More Showroom

Dodge emblem on orange vehicle
Showroomby Hannah MitchellJune 15, 2026

New Vehicles Down for Most Brands

Healthy May sales cut into inventory as automakers kept a tight reign on supply, though some brands ended the month with excess units on the ground.

Read More →
Photo of the back of an electric Mercedes
Showroomby Hannah MitchellJune 10, 2026

Auto Prices Ride May Moderation

Flat ATPs and asking prices clocked in below long-term averages for the month, though some segments saw significant price gains, reported Cox Automotive.

Read More →
Orange Mitsubishi car on grass
Showroomby Lauren LawrenceJune 8, 2026

Mitsubishi Sets Growth Strategy, Structural Transformation

The Japanese automaker aims to 'strengthen products and technologies that embody its brand identity,' focus on its strongest markets and expand value-chain businesses 'that leverage its unique strengths.'

Read More →
Ad Loading...
inside of car, view of steering wheel with hands on it driving
Showroomby Lauren LawrenceMay 29, 2026

Affordable, Safe Cars for Teen Drivers

Families looking to balance affordability and safety in vehicles for their teen drivers can look to the updated list of recommended vehicles by IIHS and Consumer Reports.

Read More →
Gray-scale photo of a line of Mini cars in a dealership parking lot
Showroomby Hannah MitchellMay 27, 2026

Auto Dealers Feel Better But Not Great

A second-quarter Cox Automotive poll of franchised retailers and independents found better views of the current market after a good spring but anticipation of third-quarter storminess.

Read More →
exterior daytime image of Porsche North Miami dealership
Showroomby Lauren LawrenceMay 22, 2026

Holman Opens Porsche Dealership in Miami

The North Miami store features the brand’s signature Destination Porsche design concept, combining contemporary architecture and technology to create what the auto group calls an ultra-luxury experience.

Read More →
Ad Loading...
Outside of a Cadillac dealership.
Showroomby Lauren LawrenceMay 20, 2026

Chicago to Gain Cadillac Rooftop in 2027

The two-story Cadillac dealership is being constructed at the former Lincoln Yards site, owned and operated by Canada-based Jack Carter Auto Group.

Read More →
Photo of sold Ford store exterior
Showroomby Hannah MitchellMay 11, 2026

Mid-Atlantic Ford Store Has New Owner

A growing Maryland automotive group is only the 93-year-old dealership’s third owner after its longtime proprietors retired.

Read More →
groundbreaking ceremony for new Barrington Porsche dealership with Murgado Automotive Group and Joseph Nicholas Construction
Showroomby Lauren LawrenceMay 11, 2026

Porsche Dealership Breaks Ground in Illinois

Barrington Porsche will be the new location for Murgado Automotive Group’s existing Porsche dealership currently in the Motor Werks of Barrington auto mall.

Read More →
Ad Loading...
aerial view of Fireside Honda in Ohio
Showroomby Lauren LawrenceMay 6, 2026

Michigan Auto Group Acquires Ohio Rooftops

Feldman Automotive Group added two new brands, Honda and Toyota, to its portfolio with its latest acquisition of four Fireside dealerships in Ohio.

Read More →