Listening to car dealers and auto industry analysts discuss the impact of Congress’ July 4 passage of the One Big Beautiful Bill Act (OBBBA) is a bit like tuning in to the World Series. It seems everyone has a side, and the outcome finds them jubilant or in despair.

On one side, there are the car dealers, their colleagues and green advocates who have gone all in on EVs – whether through purchases, stock, congressional lobbying or attitude. Then there are the dealers and analysts who breathe a sigh of relief that the days of a government EV push are over, as some have told WardsAuto there weren’t enough buyers coming through their doors who wanted EVs or who qualified in full or at all for the $7,500 federal EV tax credit the Act eliminates in September.

“I didn’t know when I became a car dealer, I was becoming a politician, too,” says one dealer who spoke with WardsAuto, referencing how heated the U.S. political landscape has become around the topic of an automobile’s means of propulsion.

Why have that attitude?

When Congress passed the Act on July 4, it shifted the industry away from what many dealers saw as an aggressive EV agenda, and now they say the Act’s passage should bring ICE vehicles back into the spotlight. It also introduced new tax breaks for both businesses and consumers that could pave the way for a healthier retail auto market, even as the Federal Reserve declines to cut interest rates.

“It’s largely very favorable,” Tyler Corder, chief financial officer, Findlay Automotive Group, headquartered in Henderson, NV, tells WardsAuto. “There are some things that will help us, I think, in the car business a little bit. The big one, of course, is the deductibility of auto loan interest. I think it’s capped at $10,000 a year in deduction. So, people can deduct the interest on their car loans. That’s huge and will help car sales.”

Corder also points to provisions particularly relevant to hospitality-driven markets like Las Vegas: “The big thing for us in (nearby) Las Vegas is the no tax on tips. So much of (our market) is driven by the hospitality business, and most of the employees...live on tips, and if they’re not taxed on those tips, that’s huge for us.”

He notes the tip deduction cap is $25,000 and says the resulting boost in disposable income and consumer confidence could “absolutely” drive more car sales.

Industry analyst Patrick Sheposh, executive vice president, Automotive Mobility Group at Ipsos, a global market research firm, tells WardsAuto the passage is not surprising.

“The baseline summary is, this is very aligned with the Trump Administration’s macro policy of focusing on reinvigorating the US industrial base – thus a revival of the ‘middle class’ (that was) lost as globalization of supply lines initiated with vigor,” he says. “A significant component of that revitalization centers around automobile manufacturing.”

According to Sheposh, “The OBBBA bolsters U.S. (manufacturers) through tax breaks, relaxed regulations and domestic production incentives, aligning with their hybrid- and gas-vehicle strategies.” In short, he says, “U.S. OEMs benefit more. That’s the whole point.”

Still, the changes are not without disruption. Karl Brauer, executive analyst at iSeeCars, tells WardsAuto that the elimination of the $7,500 federal EV tax credit will cause a short-term sales spike before demand collapses.

“Dealers are going to have to balance 'How many EVs do I want on the lot between now and September 30?' to take advantage of what’s going to probably be a heightened level of buying before the incentive leaves,” says Brauer. “'And how do I time it perfectly? So, the last EV is driving off the lot with its new buyer on September 30 at, you know, 7 p.m. before the store shuts?'”

After that deadline, many dealers may be stuck with inventory they can’t move. “Those things are going to be boat anchors,” Brauer warns.

Corder agrees: “If you had a whole bunch of electric cars in used-vehicle inventory, and that tax rebate goes away in September, there’s going to be a big push to get rid of all those cars before (then)...because they’re going to be worth a lot less.”

Sheposh notes that while the tax-credit loss will hurt, the broader bill includes offsets: “The challenges include the elimination of the $7,500 tax credit on EVs. However, there are a lot of other tax savings in the broader bill that can offset.” He adds that many previous buyers no longer qualified anyway due to income caps, so the impact may not be as dramatic as it appears.

For foreign automakers, the landscape is mixed. “Non-U.S. OEMs with significant U.S. manufacturing, like Toyota, Honda and Hyundai, gain from the same construction deductions and auto-loan-interest benefits for U.S.-assembled vehicles,” Sheposh says. “But focused brands like Hyundai and Kia, which (offer a number of) EVs, face reduced demand due to the EV tax credit’s end.” New sourcing restrictions on battery credits further complicate eligibility for brands with foreign supply chains.

Meanwhile, automakers and dealers alike welcome relaxed federal fuel economy rules. “Eliminating (emissions or Corporate Average Fuel Economy standards) is a big thing for us,” says Corder. “That was designed to force us to sell electric vehicles when there was no demand for them.”

Sheposh calls this provision “really huge and somewhat ignored by the press,” adding, “By effectively nullifying (CAFE) fines, the bill reduces compliance costs, allowing manufacturers to prioritize gas-powered and hybrid vehicles over less-profitable EVs.”

Both Corder and Brauer see hybrids – especially plug-in hybrids – as the next practical step forward.

“You’re going to see the plug-in hybrids are going be the big thing,” says Corder.

Brauer agrees: “The movement from internal combustion to hybrid really isn’t that big of a movement...but the movement from hybrid to EV is a whole other ball of wax.”

Corder believes EVs still have a place in the market but says the government now recognizes that “policy cannot catapult the market into acceptance like the failed experiment of promoting EVs before infrastructure – and most importantly – customer acceptance had been achieved.”

For now, the industry is recalibrating.

“As far as the Big Beautiful Bill, I think it’s generally very favorable,” Corder says. “The tax provisions...are going to be very helpful...If it helps the economy, that’s the big thing... and if consumer confidence is good, then people buy cars.”