Cox Automotive recently released its latest Kelley Blue Book EV sales report, offering a snapshot of current electric vehicle market dynamics. On today’s episode of CBT Now, Stephanie Valdez Streaty, director of insights at Cox Automotive, joins us to break down the report’s findings and what they mean for the remainder of 2025.
According to the report, U.S. EV sales declined 6.3% year over year in Q2, closely matching Cox Automotive’s projections. Still, the market showed signs of resilience with nearly 5% growth quarter over quarter, driven in part by consumers rushing to take advantage of the federal Inflation Reduction Act (IRA) tax credit before its expiration. Tesla, which still leads the EV market, saw a 12% drop in sales, weighing down the overall numbers. Excluding Tesla, EV sales were largely flat, with some automakers, like Chevrolet, posting growth thanks to new offerings like the Equinox EV.
Valdez Streaty emphasized that the EV market continues to face several headwinds. Price remains a top concern, with EVs carrying an average premium of around $10,000 over gas-powered vehicles. Meanwhile, infrastructure limitations and regulatory uncertainty continue to challenge broader adoption. Despite these barriers, leasing is emerging as a key driver of growth, now accounting for approximately 60% of EVs on the road. Leasing not only lowers monthly payments, but also addresses consumer concerns over battery longevity and depreciation.
Additionally, Valdez Streaty underscores the importance of educating consumers about EV battery warranties, which typically last 8 to 10 years or up to 100,000 miles. She notes that this knowledge gap can fuel hesitation among buyers unfamiliar with EV ownership.
Another key issue she touched on was dealer readiness. During the conversation, host Jim Fitzpatrick highlights how fewer than 15% of new car salespeople currently drive EVs themselves. Valdaz Streaty notes that the lack of firsthand experience can hinder their ability to effectively guide customers through the transition, making education and local engagement efforts increasingly critical for retailers.
“The EV market is very dynamic and complex. It’s not just about incentives; it’s about infrastructure, pricing, and consumer education.”
Meanwhile, competition in the EV space is intensifying. General Motors and Honda have gained ground in the first half of 2025 with broader lineups and competitive incentives, while Tesla has seen its market share slip due to product delays and ongoing brand challenges. The expiration of federal tax credits in September is expected to drive a short-term sales spike in Q3, followed by a likely dip in Q4. Ongoing state-level incentives and OEM strategies will remain key to shaping adoption moving forward.
Moreover, the used EV market is accelerating rapidly, with a record 100,000 units sold in Q2. Used EV prices are nearing parity with used internal combustion engine models, offering more affordable entry points for buyers. Valdez Streaty also highlighted the potential future impact of low-cost, high-quality EV imports from China, although timelines remain unclear.
Nevertheless, Valdez Streaty said that while EVs are a vital part of the industry’s future, the transition remains complicated. Hybrid and plug-in hybrid models continue to serve as crucial options for many consumers as the market adapts to shifting regulations and evolving consumer preferences.
