Yahoo Finance·2025-10-04 17:05Group 1 - The core issue facing electric vehicle (EV) manufacturers like Lucid Group, Rivian, and Tesla is the elimination of critical subsidies, which will impact demand and pricing strategies [1][7] - The demand for electric cars is expected to be lower than previously anticipated due to the removal of tax credits that have historically reduced the upfront cost for consumers [2][4] - The elimination of tax credits by September 30, 2025, will increase the final cost of EVs by up to $7,500, which is significant as nearly 70% of Americans plan to spend less than $50,000 on their next vehicle [3][4] Group 2 - Another significant subsidy, the CAFE regulatory credits, which are earned by manufacturers exceeding fuel economy standards, will also be eliminated in 2026, further impacting the financial landscape for EV makers [6][7] - To mitigate the expected decline in demand, EV manufacturers may need to reduce prices, which could lead to lower gross profits [4]