With a ticking clock on Gov. Jared Polis’ 2019 aspirations to put 940,000 electric vehicles on Colorado highways by 2030, his plan hit a major pothole when President Donald Trump ordered cancellation of the Biden administration’s Inflation Reduction Act Clean Vehicle Tax Credits.
On Sept. 30, the federal tax credits worth up to $7,500 per purchase will vanish. The cutoff, passed by Congress in July, threatens to stall the state’s EV goals just as sales data show a pre-deadline buying frenzy that is masking deeper uncertainties in the market, according to industry experts.
The subsidy has been providing up to $7,500 for qualifying new battery electric vehicles or plug-in hybrid electric vehicles with a manufacturer’s suggested retail price up to $80,000 and up to $4,000 for used EVs priced under $25,000.
In 2024, Colorado surged ahead of California to claim the nation’s top spot for EV sales per capita, with battery electric vehicles and plug-in hybrids capturing 25.3% of new vehicle purchases — 9,446 units in that period alone, according to the Colorado Energy Office.
“Newly released data … shows that in the 3rd quarter of 2024, Colorado passed California to become the top state in the country for EV sales,” the office said in a December 2024 news release.
But that was a short-lived artificial boost. The total number of EV registrations quickly fell from 22,500 in Q4 2024 to 15,184, a 32.5 percent drop, in Q2 2025. Another spike in Q3 2025 is underway to beat the tax credit expirations according to the state energy office.
Polis kicked off his “ambitious plan” with an executive order upon taking office in January 2019.
He framed EVs as the backbone of Colorado’s net-zero emissions goal for transportation by 2050.
“Colorado’s national leading progress in electric vehicle adoption is a key part of our ambitious efforts to achieve net-zero emissions in transportation by 2050,” Polis stated in the December 2024 release.
The end of the Biden subsidies hits at a precarious moment for EV buyers.
Colorado’s state EV incentives have decreased from $5,000 to $3,500, effective Jan. 1, 2025.
A Sept. 3 rush saw buyers flood dealerships to lock in credits via pre-deadline payments, even for post-October deliveries. Still, Matthew Groves, president of the Colorado Automobile Dealers Association, warned: “Fewer discounts will inevitably slow Colorado’s red-hot EV market.”
“So, who’s really going to suffer here is middle and lower-income Americans, because a lot of people who were buying the more expensive EVs were never using that credit in the first place,” Groves told The Denver Gazette.
Groves also said the upper-end market is largely unaffected due to income and sale price restrictions.
While Groves believes there will be a slump in EV purchases after the federal credits expire, he’s confident that the EV market in Colorado isn’t headed for disaster, rather it’s headed for an adjustment that Colorado automotive dealers have been preparing for since the change of administration at the White House.
From 2019, when EV new Colorado registrations totaled just 8,015 amid 229,000 overall sales (a 3.5% share), the market jumped to 44,378 in 2024 (20.0%). Year-over-year EV growth averaged over 50% through 2024, outpacing total automotive market expansion of 6%-8% annually.
The Colorado Energy Office reported in July that in the first quarter of 2025, EV sales remained strong at 26% of total automobile sales.
But industry professionals say that’s all likely to change come Oct. 1.
From about 25,000 EVs on roads at 2019’s end (0.46% of 5.41 million total vehicles), the fleet swelled to 183,000 by mid-2025 (3.24% of an estimated 5.65 million).
The 2023 Colorado EV Plan from the Energy Office, Department of Transportation, and Public Health and Environment, wants to see a near-100% light-duty EV market share by 2050.
A May 21, 2025 analysis by Conservation Colorado, via the Southwest Energy Efficiency Project, claims “Colorado drivers could lose as much as $5.5 billion in consumer savings over the next five years if Congress repeals the federal electric vehicle (EV) tax credits.”
That’s on top of a 2019 Energy Office study projecting $43 billion in lifetime fuel and maintenance savings through 2050 from widespread adoption.
Environment America hailed the 2024 peak in a Dec. 5 statement: “In the third quarter of 2024, 25.3% of all new vehicle sales in Colorado were EVs, propelling Colorado’s market share ahead of California’s for the first time. This is a huge win for our climate and clean air.”
However, this doesn’t accurately reflect the on-the-ground reality, where EVs make up only 4.16 % of the state’s vehicle fleet — 96.75% of all vehicles on the road run on internal combustion, according to the state’s electric vehicle dashboard.
Nor, according to Gallup, is EV ownership subsantially benefiting lower-income persons making less than $40,000. The Gallup data indicates that 61% of that category would not buy an EV, and 29% might consider it. In the top income echelon of $100,000 and up, 14% own an EV, 34% might consider it in the future, and 41% would not buy one.
But Polis remains bullish.
“Colorado is a national leader in electric vehicle adoption, and I’m confident market demand for these vehicles will continue because they are fast, quiet, fun, and help protect our air quality and save Coloradans money through lower maintenance costs,” said Polis in a statement to The Denver Gazette. “Colorado consumers have shown that they want EVs. The best deal you’re going to get in a long time is the deal you’ll get before the end of September.”
Groves agrees, though he’s not as optimistic as Polis about the state mandate that EVs must eventually comprise 82% of all vehicle sales.
“No, I don’t think it’s a catastrophe. Fortunately, they gave us about three months to prepare for it, so we are getting ready for the thing to wind down,” Groves said. “We’ve been speculating about the expiration of this credit going back to the election in November. So, it will take a little bit of inventory management on dealer’s behalf. But we do believe that, unlike other states, there will continue to be an electric vehicle market here.”
He added, “At one point last year we were one-out-of-every three cars with electric. Now that might drop to one in 10, one in 15, but there will still be a percentage of people who want that vehicle, and we will still have some of them here to meet their needs. It just won’t be 82% of all cars sold.”
Groves also notes that sales of internal combustion engine vehicles have been “incredibly resilient.”
“There are a lot of things that should have torn away at the market,” Groves said. “Tariffs, interest rates, inventory shortages — and people are still buying cars at a rate that they were pre-COVID. We are estimating this year that the new vehicle market is going to be about 220,000 vehicles, and that is on the trajectory we were on prior to COVID.”
