🧠 Food for thought

Implications, context, and why it matters.

January’s dip traces back to a subsidy-driven buying rush

• After a strong 2025, global EV sales rose 20% to 20.7 million units, then cooled in January 1.
• North America fell 33% after U.S. federal tax credits expired on September 30, 2025, which pulled purchases into a last-minute rush 2.
• China dropped 20% after ending a decade-long full exemption on its vehicle purchase tax, moving to a 5% rate in 2026 3.
• Other regions climbed 92%, driven mainly by Thailand after the registration deadline for an EV subsidy program moved into January 2026 4.

Automakers shift toward hybrids as all-electric plans hit bumps

• With incentives fading in markets like the U.S., what buyers can pay now shapes the EV shift more than regulation does 5.
• Since 2023, battery-electric vehicle (BEV) share in North America has stayed under 8%, while full hybrids lead all powertrain types in customer loyalty 5.
• Automakers booked about $55 billion in writedowns over the past year and are dialing back EV targets in favor of hybrids 6.
• Range-extended electric vehicles (REEVs), which pair an electric drivetrain with a small fuel-powered generator to extend driving range, are set to enter the U.S. over the next few years to match demand for larger vehicles 6.
• Chinese EV makers are leaning on exports to Southeast Asia and other markets to offset softer demand at home, with that push running into 2026 6.