The U.S. electric vehicle market isn’t taking off the way many expected.
After years of government subsidies and corporate push themselves, 2025 is the year when electric vehicle dreams and reality collide.
Consumers are flocking to car dealerships to buy electric vehicles before the $7,500 tax credit expires in September.
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2025 (as of September): More than 1 million units, market share 10.5%
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2024: 1.3 million, market share 8.1%
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2023: 1.2 million, market share 7.8%
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2022: 800,000 5.8%, market share
Source: Cox Automotive
But even this buying spree has had its problems.
U.S. consumers purchased 90 different electric car models in the third quarter, but only nine sold more than 10,000 units.
The Tesla Model Y and Model 3 were the best-selling models, with sales of more than 114,000 and 53,000 units respectively, while the Chevrolet Equinox sold just under 25,000 units.
But all three models are outliers.
“The vast majority of electric vehicles sell well below 2,000 units per month, or 6,000 units per quarter. In the volume-driven business of automaking, low sales are the enemy; EV profitability remains a distant dream for nearly all automakers,” Cox Automotive said.
With the writing on the wall, OEMs like General Motors have been rethinking their EV strategies.
General Motors said it and other original equipment manufacturers will lose billions of dollars on investments in electric vehicles due to changes in government policy.
“With recent U.S. government policy changes, including the end of certain consumer tax incentives for electric vehicle purchases and the easing of the stringency of emissions regulations, we expect the adoption of electric vehicles to slow,” GM said in an October 8-K filing.
General Motors is preparing to spend billions of dollars to adjust its production of electric vehicles.
The company’s board approved a $1.6 billion third-quarter charge for General Motors North America for “planned strategic adjustments to our electric vehicle capacity and manufacturing footprint” to meet consumer demand.
As a result, General Motors announced it would lay off more than 1,000 workers at Plant Zero, its all-electric vehicle assembly plant in the Detroit-Hamtramck area of Michigan.
GM also said it would reduce factory production to one shift.
But its adjustment in the scale of electric vehicle production does not end there. On Monday, January 5, workers at GM’s Lordstown, Ohio, plant where it makes some fuel cells for electric vehicles received similar bad news.
General Motors sold its Lordstown, Ohio, assembly plant in 2019 and no longer operates the plant. However, the company is maintaining operations at the site, which includes Ultium Cells, which produces batteries for its electric vehicles.
General Motors sent a letter in October announcing that it would begin “massive layoffs of GM hourly employees” on January 5 at the Lordstown plant.
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More than 1,300 employees will be affected, including 850 employees who will be temporarily laid off. However, hundreds of jobs at the Ultium Cells battery plant in Lordstown are being eliminated, possibly permanently.
The majority of employees affected by the layoffs in Lordstown are battery assembly operators, the company said. General Motors said it would take advantage of the production slowdown and reduced workforce to upgrade its factories.
“Over the past several years, our product portfolio and capacity plans have been shaped by increasing regulatory stringency on fuel economy and emissions. To meet these requirements, we have aggressively expanded our electric vehicle production capacity,” CEO Mary Barra said in the letter.
“However, as the regulatory framework continues to evolve and federal consumer incentives end, it is now clear that short-term EV adoption will be lower than planned. That is why we are re-evaluating our EV capacity and manufacturing footprint… By acting quickly and decisively to address overcapacity, we expect to reduce EV losses in 2026 and beyond,” Barra said.
Local NBC News television affiliate WFMJ 21 saw that in addition to 142 quality operators and 102 materials operators, 1,090 battery assembly operators were laid off, according to documents filed by the Ohio Department of Jobs and Family Services.
General Motors recorded a non-cash impairment charge of $1.2 billion in the third quarter as the company adjusted its manufacturing capabilities. The company collected another $400 million in contract cancellation fees and commercial settlements.
However, that number could increase as GM said its re-evaluation of its electric vehicle capacity, manufacturing footprint and battery component manufacturing is underway, “and it’s possible we will recognize additional cash and non-cash charges for materials in the future.”
GM isn’t the only company to lose billions on electric vehicles this year.
Ford said it expects losses on its electric vehicle unit Model E to exceed $5 billion this year.
For the United States, battery electric vehicle (BEV) sales are in the right lane, while China and Europe are in the passing lane, although U.S. EV sales have been strong this year.
JD Power said that the market share of electric vehicles in the United States is expected to exceed 12% for the first time, with sales increasing by 2.6% year-on-year.
However, the US market (1.2 million) is still much smaller than China (6.4 million) and Europe (2.2 million).
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This article was originally published by TheStreet on January 6, 2026, and first appeared in the Automotive section. Click here to add TheStreet as your preferred source.