US EV prices are going back up as discounts shrink

Electric vehicle prices in the US are ticking back up after months of decline. New EVs sold for an average of $56,126 in July, up 1.2% from June and 1.6% higher than a year earlier — the first year-over-year increase since December, according to Kelley Blue Book.

A big reason is that automaker discounts are shrinking. EV incentives averaged $6,626 in July, down 9% from June and down nearly a quarter from a year ago. Those discounts now cover about 11.8% of the average EV's price, down from 15.8% last year. Tesla saw a similar pattern: its average price rose to $53,891, while its incentives dropped by about a third from a year earlier to $5,599, covering just over 10% of the purchase price.

EVs still cost more than gas-powered vehicles overall — the average new vehicle sold for $49,855 in July, over $6,000 less than the average EV — and automakers are still discounting EVs more heavily than vehicles in general, where incentives average 6.4% of price. But the trend is moving in one direction: smaller discounts and rising prices. For anyone weighing an EV purchase or watching prices to decide when to buy, this is a signal that the recent run of falling EV prices has ended, at least for now, and shoppers are paying somewhat more than they were earlier this year.