P&A Providers & Administrators
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

Originally posted on F&I and Showroom

More Industry

Photo of gray SUV plugged into public electric-vehicle charger in parking lot
Industryby Hannah MitchellJuly 21, 2026

World EV Adoption Set to Grow

A new report says the segment, despite recent setbacks in some regions, is poised for acceleration as many countries look to reduce pollution.

Read More →
Bar chart of truck and SUV segments' weekly value change
Industryby StaffJuly 21, 2026

Black Book: Weekly Market Update

Wholesale automotive auction business stayed steady last week as bidders encountered lower prices, analysts observed.

Read More →
laptop with blue car on screen on a shopping website, Clear Costs Convert
Industryby Lauren LawrenceJuly 21, 2026

Pricing Transparency Drives Purchase Consideration

An annual study by JD Power found that clear pricing matters to consumers on automaker websites, so much so that it increases their purchase consideration.

Read More →
Ad Loading...
Bar graphic of used-car segment weekly change
Industryby StaffJuly 14, 2026

Black Book: Weekly Market Update

Used-vehicle market depreciation was the prevailing story in the wholesale market last week.

Read More →
Light-blue Fiat car parked on a sunny Chicago street
Industryby Hannah MitchellJuly 14, 2026

Smaller Is Looking Better

A growing number of Americans in the market for a new vehicle are opting for more affordable options, not waiting for market stability to bite the bullet.

Read More →
man sitting at desk using calculator with charts in front of him, to-go coffee cup on desk, rising and falling data chart in front
Industryby Lauren LawrenceJuly 14, 2026

U.S. EV Market Slowly Stabilizes

U.S. electric-vehicle interest is slowly stabilizing since a major dip in sales after last year's end of the federal EV tax credit, and hybrids remain the leading electrified power train.

Read More →
Ad Loading...
blue background, map of the world with connecting lights and an electric vehicle emblem in the middle
Industryby Lauren LawrenceJuly 8, 2026

Global EV Market Entering New Phase

Automakers are making investments to lower battery costs and optimize production to meet changing consumer needs.

Read More →
Bar chart showing week-over-week wholesale automotive price change
Industryby StaffJuly 7, 2026

Black Book Weekly Market Update

The holiday weekend, not surprisingly, put a drag on wholesale automotive activity last week, analysts observed.

Read More →
Photo of Honda CR-V SUV on two-lane road next to roadside trees
Industryby Hannah MitchellJuly 1, 2026

Auto Affordability in Context

Cox Automotive points out the complex circumstances that have led to eye-popping vehicle prices.

Read More →
Ad Loading...
Line chart of used-vehicle days to turn over past week
Industryby StaffJune 30, 2026

Black Book: Weekly Market Update

Automotive auction inventory increased last week, giving choosy bidders even more leeway.

Read More →