The EV market is on the road to recovery thanks to high gas prices

EV sales were up nearly 15 percent from the start of the year, but the recovery is a bit of a mixed bag.

As the US war on Iran sent gas prices soaring , American car buyers flocked to electric vehicles — and in particular hybrids .

After a sluggish winter and fall, EV sales rebounded in the second quarter of 2026, with automakers posting some of their best numbers since the elimination of the federal EV tax credit last year, according to a Q2 analysis from Cox Automotive . I wouldn’t go so far as to say EVs are back to their pandemic-era numbers, but there are some promising signs that we may be through the worst of it.

Drivers snapped up about 247,000 EVs in the second quarter of 2026, a nice 14.7 percent jump from the start of the year, according to Kelley Blue Book estimates. But it’s a bit of a mixed bag. If you look at the bigger picture, sales are actually down 20.5 percent compared to the same time last year, marking the third straight quarter in the red.

The silver lining? The slump is finally slowing down. This quarter’s drop wasn’t nearly as brutal as the 27 percent dip we saw in Q1, or the massive 36 percent plunge at the end of 2025. All in all, it’s starting to look like the EV market is finding its footing after a rough patch.

The company reaping the most benefits from this modest recovery is Tesla . One in three new EVs purchased in Q2 was a Tesla. It’s not a full recovery; the company’s sales were still off more than 10 percent in the first half of the year, as compared to 2025. However, Tesla accounted for roughly half of all EV sales in the US, driven almost exclusively by the Model 3 and the Model Y. This comes after a brutal 2025 for Elon Musk’s company, in which Tesla’s market share dropped below 40 percent, its lowest point in eight years .

Chevy, with its Equinox and Blazer EVs, was a distant second, followed by Hyundai and Cadillac. Cox also cited Toyota and Subaru as “standout performers,” with 225 percent and 108 percent sales growth in Q2 year over year, respectively. Toyota in particular was widely seen a laggard in EVs, but now ranks in the top five US sellers in the US market. As other brands delay or cancel battery-powered models, the Japanese auto giant is planning additional models, including the three-row Highlander SUV .