US Senate puts $40k cap on price of electric cars that qualify for EV tax credit(electrek.co)
electrek.co
US Senate puts $40k cap on price of electric cars that qualify for EV tax credit
https://electrek.co/2021/08/11/us-senate-40000-limit-price-electric-cars-ev-tax-credit/
6 comments
The goal of the program is to put EV's on the road. Limiting it by income does not help that.
The average cost of a new car is $40k, which is where they are setting the cap.
Electric vehicles cost more than their gas counterparts.
This is an attempt to kill the tax credit all together...
Public perception matters. If the program is perceived to be unfair expect it to get canceled.
From my vantage point, the goal of the program has appeared to be to enrich Elon Musk. With each (tax subsidized) car sold, he then got to sell the offsets to the legacy car manufacturers. This has been green-washed tax harvesting on an enormous scale.
Tesla is already supply limited. They sell every car they produce and are ramping as fast as they can. So, this tax credit doesn't help them sell more cars. The credit was meant as a boost to legacy automakers--or more specifically their union labor force who are big political donors.
The cap kind of defeats the purpose of the credit though. Legacy automakers aren't currently able to profitably make a compelling, long-range BEV at a $40k price point. So they'll have to push crappy shorter-range models or polluting plug-in hybrids if the credit allows it. It also would hurt Tesla because it would make their higher margin long-range models harder to sell vs. the lower margin standard range.
The cap kind of defeats the purpose of the credit though. Legacy automakers aren't currently able to profitably make a compelling, long-range BEV at a $40k price point. So they'll have to push crappy shorter-range models or polluting plug-in hybrids if the credit allows it. It also would hurt Tesla because it would make their higher margin long-range models harder to sell vs. the lower margin standard range.
This is great. We NEED cheaper EVs in the US. Europe and China have had access to them for years now, in the US if you want a cheap EV you have to look to the older used market in most cases. Once new $25k EVs are commonplace in the US I think we’ll see mass adoption and infrastructure investment from the government and companies.
Overall, as presented by the article, it makes sense limiting who can receive the credit based on income level and car price.
It will create more "working-class" EVs that a middle-class consumer can buy.
If you make more than $100k, you can afford an EV full price, you just need spend your money wisely.
Overall, it seems like a decent that I hope makes it to pass the House.