Tesla investors are facing challenges in 2025 with a stock price down over 20% year-to-date and a major slump in global electric vehicle sales. President Trump’s spending bill, signed into law on July 4th, will end federal tax credits on certain EVs, impacting Tesla investors.

The bill will bring an end to federal tax credits on Tesla EVs, with buyers having until Sept. 30 to qualify before they’re terminated. New EVs had a $7,500 credit, while used EVs had up to $4,000. This change aims to make EVs more affordable but could hurt Tesla sales.

The average purchase price of a new EV in the U.S. is $9,000 higher than a new gas-powered car, with used EVs costing $2,000 more. Ending the tax credit will narrow the pool of potential EV buyers, impacting Tesla and its shareholders.

The new bill stipulates that companies selling over 200,000 EVs from 2009 to 2025 don’t qualify for the tax credit. This provision mainly affects Tesla, which sells more cars in a single quarter than rivals Rivian and Lucid. This could give the latter an edge in the short term.

Tesla’s EV sales have dropped significantly this year, with second-quarter sales down 13.5% from the previous year. Trump’s spending bill will likely exacerbate this decline by removing tax incentives, making Tesla purchases more expensive.

Read more at Yahoo Finance: 3 Ways Trump’s ‘Big Beautiful Bill’ Could Hit Tesla Investors