| Thanks for reading Hyperdrive, Bloomberg's newsletter on the future of the auto world. Read today's featured story in full online here. Getting Tax Credits Before They're Gone | President-elect Donald Trump's threat to eliminate tax credits for electric vehicles likely gave plug-in cars a much-needed boost after a disappointing year, part of a broader surge in auto sales at the end of the year. EV sales grew 12% in the fourth quarter of 2024, pushing the full-year total to a record 1.3 million, according to forecasts from researcher Cox Automotive. That's up from an 8% growth rate in the previous quarter. Plug-in models make up around 8% of the overall US car market, only slightly more than a year ago. A strong fourth quarter also helped push total car sales up from the year prior. The annualized rate for 2024 rose to 15.9 million cars, based on the average forecast of four researchers, up from 15.5 million a year ago. This EV surge isn't expected to last into 2025. The results of the US presidential election encouraged buyers holding out for deals to make purchases before policy changes championed by Trump make electric options even more expensive next year.  A customer looks at the trunk of a vehicle at a Tesla store in Colma, California. Photographer: David Paul Morris/Bloomberg Only a quarter of new-car shoppers are considering an EV for their next purchase, down two percentage points from a year ago, according to JD Power. "Threats and worries" contributed to a "sense of urgency to buying," Jonathan Smoke, Cox's chief economist, said on a December call with reporters. "That's true in overall purchase activity, and it's also very much true to the EV story." Trump made repealing federal policies meant to boost US EV sales a key part of his campaign, railing against what he called President Joe Biden's "insane electric vehicle mandate." Advisers to his transition team have recommended cutting the $7,500 tax credit on plug-in vehicles, which would make the already expensive vehicles even further out of reach for US consumers. The president-elect has also threatened tariffs on Canada and Mexico that could also drive up the price of cars. As for the overall new-car market, lower interest rates, rising manufacturer incentives and fading anxiety around the election drew more buyers, prompting analysts to raise full-year sales forecasts. Earlier in the year, inflation and a cyberattack on car dealerships had dimmed the sales outlook for 2024. General Motors was likely the the biggest automaker in the US by sales last year, delivering 2.7 million cars, followed by Toyota, Ford, Hyundai and Honda, according to Cox. Stellantis, which has been plagued by product launch delays and bloated inventories that led to the ouster of its CEO last year, fell to sixth place with a 15% plunge in deliveries, Cox forecast. For EVs, Tesla is still the sales leader by far, though the company posted its first annual drop in global deliveries in more than a decade last year. Electric compact and midsize SUVs from GM, Honda, Hyundai and Kia attracted more US shoppers in December, according to JD Power.  GM's Chevrolet Equinox EV at the Chicago Auto Show in February 2024. Photographer: Jacek Boczarski/Anadolu via Getty Images Affordability is keeping sales of all kinds of cars below pre-pandemic levels, according to Jeff Schuster, GlobalData's vice president of automotive research. The average retail transaction price for new vehicles is trending toward $46,258, according to JD Power. For EVs, high costs are the biggest stumbling block for potential buyers, followed by insufficient charging infrastructure. On average, EV buyers got a $5,600 rebate per car with the current tax credit, JD Power figures show. Without that kind of incentive, demand could plunge as much as 27%, according to economists. While some carmakers, including GM and Hyundai, have pledged to push ahead with EV offerings regardless of policy changes, others have delayed EV plans to prioritize hybrids, which saw outsize growth in 2024. Stellantis said last month it would delay launching its all-electric Ram a year in favor of an extended-range version. Hyundai said it would double its hybrid lineup, and Ford pledged to offer hybrid versions of all its models by 2030. Automakers that take that "basket approach" will come out on top in 2025, GlobalData's Schuster said. "If you have a full lineup of options, that's who wins."  Photo illustration by 731. Photos: NASA (1), Getty Images (6) Over the holiday break, Elon Musk was busy furiously posting his way into fights with ultra-right wing MAGA luminaries Laura Loomer and Steve Bannon about immigration visas. Once the calendar turned to 2025, two other stories overshadowed the civil war in Trumpland: a deadly Cybertruck explosion in Las Vegas, and some disappointing sales numbers from Tesla. Bloomberg's David Papadopoulos, Max Chafkin and Dana Hull break it all down in the latest episode of the Elon, Inc. podcast. Listen and subscribe on Apple, Spotify, iHeart and the Bloomberg Terminal.  The Mercedes GLC 350e. Photo courtesy of Mercedes The Mercedes GLC 350e offers four zones of climate control and its headlights project icons onto the pavement — such as a pedestrian — to warn of coming hazards. But the SUV's most impressive trick is less ostentatious: It can travel from Ossining, New York, to Midtown Manhattan — roughly Don Draper's commute in Mad Men — entirely on electrons, with its turbocharged, 4-cylinder gas engine just along for the ride. Then it can turn around and do it again. As electric car adoption continues in fits and starts, auto executives have created a killer app for the wide swath of American drivers that fall between EV-curious and EV-skeptical: the super hybrid. | 
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