California reported that nearly 12,000 residents have purchased electric vehicles (EVs) under a new $270 million rebate program launched in July, which is jointly funded by the state and several automakers. Despite this uptake, overall EV sales have declined both within California and across the United States in recent months.

The rebate initiative, signed into law by Governor Gavin Newsom, offers residents $3,500 back on new electric vehicles priced up to $50,000, as well as $1,750 for used EVs costing no more than $25,000. The program is intended to encourage first-time EV buyers and is supported by $135.5 million in state funds matched by an equal contribution from participating manufacturers.

Eligible automakers include Ford, General Motors, Honda, Hyundai, Kia, Toyota and its Lexus brand, Lucid, Nissan, Rivian, Subaru, and Volvo. However, rebate funds for Tesla vehicles have already been exhausted, reflecting high demand and limited allocations for the brand within the program.

While this state-level effort has helped maintain some momentum in the California market, national EV sales have been affected by the expiration of federal incentives under the Trump administration, which removed tax credits that previously subsidized electric vehicle purchases. This policy shift contributed to a slowdown in U.S. EV adoption despite a continuing global increase in electric vehicle sales.

California remains a significant market for EVs, and the rebate program represents a strategic effort to counteract declines tied to evolving federal policies. How the market will respond in the longer term remains to be seen as federal incentives remain withdrawn and the state seeks to sustain its progress toward reducing vehicle emissions.