03:34 PM EDT, 10/08/2025 (MT Newswires) -- The electric vehicle market share in the US is likely to shrink in 2026 as the impact of new purchases made ahead of the federal subsidy expiration unwinds, ING Bank said on Wednesday.

US auto sales in the third quarter were on pace for the best three-month period of 2025, driven by a surge in battery electric vehicles as buyers rushed to take advantage of EV tax credits before their expiration on Sept. 30, S&P Global Mobility said late last month.

Tesla (TSLA) has reported stronger-than-expected third-quarter deliveries, while Ford (F) and General Motors ( GM ) saw record EV sales in the period.

The front-loading is expected to boost the share of new EV sales, including BEVs and plug-in hybrid electric vehicles, to 10% this year, Rico Luman, ING's senior sector economist for transport and logistics, said in a report. The EV market share will likely fall to 8.5% in 2026 amid "a correction" and waning consumer interest, Luman wrote.

The market is seen recovering in 2027, "but this will result in several years of stagnation, delaying the pace of electrification," Luman said.

"Incentives have been terminated and the momentum behind green considerations supporting EV sales has weakened, while carmakers are expected to recalibrate their strategies and shift advertising efforts toward conventional cars and hybrids," Luman wrote. "However, beyond the possibility of a more EV-friendly future administration, there are a few encouraging signs for the future."

Those signs include EVs being a more financially attractive option than internal combustion engine vehicles and an expected drop in EV prices.

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