GM and Tesla Get Closer To Losing $7,500 Tax Credit

[Adam Varga + 123]

Tesla and General Motors are seeing the beginning of the end for crucial U.S. federal tax incentives needed to transition interested car shoppers into electric vehicle owners. The federal government years ago had placed a 200,000-vehicle cap, per automaker, on EV sales before tax incentives up to $7,500 would begin to be cut back. By the end of May, Tesla was estimated to be at about 194,000 EVs sold and GM was a little bit over 182,000. 
 

https://oilprice.com/Energy/Energy-General/Tesla-And-GM-Close-To-Capping-Out-On-EV-Tax-Incentives.html

 

 

[Stormysaga + 62]

This makes sense.  That tax credit was to incentivize the purchasing of electric vehicles. This would then help electric car companies to get up. Electric car companies should be able to self-sustain now and not rely on a government crutch. 

[Vlad Kovalenko + 115]

This organization of the incentive is little weird. The cap is per manufacturer, which sort of penalizes those who were earlier to the game and put in the R&D. In the future you might be paying a $7,500 premium for the Model 3  over a Ford Focus EV, simply because Ford hasn't had an appealing enough product to sell over the cap yet.

[Sofia + 35]

The problem is the per manufacturer cap. And for some reason, while for example Volkswagen and Audi are all part of the same corporate umbrella, they get separate caps. This setup punishes the pioneers and awards the laggards.

[Guillaume Albasini + 851]

The $ 7500 tax credit could be replaced by... a 20% tariff affecting some of the main competitors if the projected tariff on imported cars is applied.

For a $ 40'000 car a 20% tariff would add $ 8000 to the price of the car.

So even if Tesla loose the $ 7500 tax credit, he EV carmaker would maintain a competitive edge on foreign imported cars.

The Model S main competitors are german cars (BMW, Mercedes). If they are imported models (BMW and Mercedes have also US plants) costing around $ 80'000 the projected tariff could increase the price to $ 96'000.

 

[DrLarza + 3]

This is all the public needs - an even more expensive car that they already can't afford and can't go 40 miles at interstate speeds w/o an 8 hour recharge.  Even if the credit was $20,000, $70,000 (the cars mentioned above) is far too expensive for 95% of car buyers.  We need a decent sized car that goes 200 miles at highway speeds w/o a recharge and costs the same as comparable gasoline models of today.  I'd surely buy one.  

[HermitMunster + 146]

Are prospective Tesla buyers i.e. Model 3 customers laying in wait really sweating the $7,500 dollar tax credit? The average Tesla owner makes really good money. Elon is the best magician on the planet.