U.S. EV landscape after subsidy phase-out: Legacy automakers cut or halt production, while Tesla, Inc. (TSLA.US) regains majority share on the strength of Model Y.

As legacy automakers cut their loss-making EV operations, Tesla, Inc. (TSLA.US) has reclaimed more than half of the U.S. electric vehicle market. According to Motor Intelligence data, as of August, Tesla, Inc. accounted for 52% of U.S. EV sales, up from 43% a year earlier. However, the gain reflects Tesla, Inc.'s relative resilience rather than a return to growth. Its domestic sales fell 16% to 325,351 units, while the overall EV market shrank 30%. For investors, Tesla, Inc.'s rising share reinforces its competitive position but does not resolve the issue of weak demand. The company is taking a bigger slice of a shrinking pie, with its automotive business heavily reliant on the Model Y. Tesla, Inc.'s long-term returns increasingly depend on whether it can translate investments in autonomous driving, artificial intelligence (AI), and Siasun Robot&Automation into meaningful revenue. In 2025, Tesla, Inc.'s market share had fallen to a record low of 41%, as competitors rolled out more electric models and CEO Elon Musk's political activities alienated some buyers. The current rebound in share coincides with automakers such as Ford (F.US) and General Motors Company (GM.US) cutting or halting EV production after federal subsidies expired. Models including the Honda (HMC.US) Prologue, Volkswagen (VWAGY.US) ID.4, and Ford F-150 Lightning are being discontinued or phased out. General Motors Company also lowered production plans for the revived Chevrolet Bolt, while Nissan (NSANY.US) delayed the market launch of the cheapest version of its new Leaf. Tesla, Inc.'s Model Y remains the company's main line of defense against the market downturn. Sales of the model fell just 2% this year, and the SUV accounts for roughly one-third of total U.S. EV purchases. Tesla, Inc. also launched a longer, six-seat version of the Model Y L this summer. Other models have fared worse. Model 3 sales fell 34%, and the Cybertruck sold only 9,769 units. The company also discontinued the Model S and Model X with no direct replacements, as Musk shifted his focus to robotaxis and humanoid Siasun Robot&Automation. Analysts are reportedly expected Tesla, Inc. to maintain its dominance in the U.S. as established automakers remain cautious about EV investments. But a stronger competitive challenge may require cheaper battery technology, new regulatory support, or a significant improvement in consumer demand.