Ford Escape, Corsair PHEVs No Longer Eligible For Tax Credit

At the start of 2024, many all-electric vehicles and plug-in hybrids lost their eligibility for the federal tax credit, or at least part of the full $7,500 incentive due to sourcing requirements for batteries and raw materials that kicked in at that time. This included a number of Blue Oval models, though some – like the Ford Escape PHEV and Lincoln Corsair Grand Touring – did remain eligible for $3,750 in federal tax credits, at least. However, that’s apparently no longer the case.

According to a dealer bulletin recently seen by CarsDirect, both the Ford Escape PHEV and Lincoln Corsair Grand Touring are no longer eligible for the federal clean energy tax credit, a change that took effect on the first day of 2025. Since the IRS defines eligibility by the day a vehicle is “placed in service,” this change impacts not only 2025 model year crossovers, but also, leftover 2024 models as well. Ford didn’t specify why either vehicle lost its tax credit eligibility, however.

This change makes the Ford Escape and Lincoln Corsair PHEVs more expensive to purchase (at least, for those that were eligible for the credit), but there is still a lease incentive that shoppers can take advantage of. CarsDirect reports that the 2024 Escape PHEV currently has a $4,750 lease incentive from Ford Credit, while 2024 Corsair Grand Touring lessees can score up to $4,250 off sticker.

All of this may prove to be moot, regardless, if incoming President Donald Trump chooses to nix the federal clean energy tax credit entirely, as has long rumored to be the case. The Ford-backed lobby group Alliance for Automotive Innovation (AAI) recently wrote a letter to Trump asking him to reconsider this decision. Meanwhile, Ford CEO Jim Farley stated that he’s not sure whether or not Elon Musk – Tesla CEO and a top adviser to Trump – could potentially save the tax credit, either, saying “I don’t know how to handicap that. We’re just focusing on us.”