Elon Musk-Led Tesla Urges Buyers To Take EV Deliveries Before Sept 30 After Trump Administration Kills $7,500 Tax Credit

EV giant Tesla Inc. (TSLA) is urging potential customers to take delivery of their new vehicles before September 30 to qualify for $7,500 federal tax credit.

Tesla shares were down 0.4% at the time of writing. On Stocktwits, retail sentiment around the stock is trending in the ‘extremely bearish’ territory. 

President Donald Trump signed the Republican tax bill into law on the Fourth of July. Under the new law, tax credits for the purchase of electric vehicles will expire on September 30. This includes the $7,500 federal tax credit on the purchase of new EVs and the $4,000 credit on buying used ones.

The expiry of federal tax credits will weigh on the pockets of Tesla consumers as several of the company’s best-selling models are currently eligible for it. As electric vehicles are generally priced higher than their gas counterparts, the tax credits were key in making them more attractive to buyers.

President Trump, in fact, pinned Musk’s criticism of the tax bill and their public falling out in June to the repeal of the tax credits on EVs.

“I took away his EV Mandate that forced everyone to buy Electric Cars that nobody else wanted (that he knew for months I was going to do!), and he just went CRAZY!” Trump said in a post on Truth Social in June.

Tesla is now urging customers to take delivery of their new vehicles by September 30 on its website, via mail, and in social media posts.

“If there ever was a time to yolo your car purchase, it's now,” the company said in a post on X on Tuesday, while adding that the sooner you order, the sooner you can pick it up.

All variants of Tesla’s Model 3 and Model Y are currently eligible for the $7,500 tax credit. This brings the effective starting price of the Model 3 sedan down to $34,990 and of the Model Y down to $37,490 for eligible customers.

The Model 3 and Y are Tesla’s best-selling vehicles across the globe. In fact, Model 3 and Y sales accounted for about 97% of the company’s total 384,122 global deliveries in the three months through the end of June.

Among Tesla’s pricier models, however, only the two lower-priced variants of the Cybertruck are eligible for the federal tax credit. This includes the long-range variant and the all-wheel variant of the Cybertruck, priced at $69,990 and $79,990, respectively, without tax credits.

The high-end variant of the Cybertruck, called the Cyberbeast, as well as the different variants of the Model S and Model X, do not qualify for the tax credit, owing to their high price points. The Cyberbeast and Plaid variant of the Model S, in fact, are priced close to $100,000, while the Model X Plaid is priced around $105,000.

The expiry of tax credits follows Tesla reporting a drop in deliveries for the second consecutive quarter. In the second quarter, Tesla reported deliveries of 384,122 units, marking a year-on-year decline of 13.5%.

In the first quarter, Tesla reported deliveries of 336,681 units, marking a dip of nearly 13% from the corresponding quarter of 2024.

In 2024, Tesla delivered 1.79 million vehicles worldwide, marking a slight decrease of about 1% compared to the 1.81 million vehicles delivered in 2023, marking the first year where Tesla reported a year-over-year drop in deliveries.

The company said in January that it expects its vehicle business to “return to growth” in 2025, but the first two quarters, coupled with the loss of federal tax credit on its best-selling models in the U.S., do not aid hopes.

Analysts, including RBC Capital analyst Tom Narayan, are now hoping for the launch of a new and affordable vehicle model to boost deliveries.

Tesla had previously stated that more affordable models were on track for production in the first half of 2025, but the plans appear to have been delayed, as the second quarter ended with no new vehicle launch.

Tesla will post its financial results for the second quarter after market close on July 23, where more details on the affordable model launch are awaited.

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