In the first quarter of 2026, the U.S. electric vehicle (EV) market exhibited a notable split: sales of new EVs plummeted by 28% year-on-year, with a mere 212,600 units sold. In stark contrast, sales of used EVs soared by 12% year-on-year, reaching 93,500 units and nearing an all-time high. The decline in new EV sales can be primarily attributed to the expiration of the federal government's $7,500 tax credit for EV purchases, which was not renewed. This led to an increase in the overall purchasing costs for consumers. Moreover, the rapid depreciation of EVs and their relatively poor value retention also contributed to the slump in new vehicle sales. On the flip side, used EVs stood out due to their price advantage. On average, they cost only $1,300 more than comparable gasoline-powered vehicles. Additionally, the ample supply of used EVs, as leased vehicles returned to the market and boosted inventory, further fueled their popularity. Furthermore, consumer interest in EVs remained robust. However, influenced by high prices and a more conservative spending mindset, buyers were more inclined to choose cost-effective used EVs over new ones.