Bills to Extend or Modify U.S. Federal Electric Vehicle Tax Credit

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#5
Its an interesting move. I think with Tesla and GM getting closer to the end Congress might very well kill the whole thing next year. I think there are 2 paths forward that fit into a political 'America-first' mindset (I'm not endorsing the mindset just showing how it might emerge in legislation).

1. Kill the whole thing. 2 US car makers have benefited from it, but it really has been a tax break for the more affluent so just kill it and claim 'fiscal responsibility'.

2. Reset the program with a universal rebate and fixed end date, maybe 2 years out. Make it as simple as anything before 12/31/2020 or some such end date. This is at least a 'level playingfield' for the US manufacturers.

Either step is good for Tesla but the 2nd is good for us too.
 

GDN

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#6
I couldn't even finish the article because it is written with such stupidity. I quote:

"The result is that it eventually ends up penalizing automakers who were first movers and invested more into electric vehicles since their customers will not have access to the incentives while automakers who were late to market with EVs end up with a competitive advantage."

No one is penalized, ever. Tesla and GM will get to sell 200,000 EV's just like any other manufacture will get 200,000 sales with the $7500 rebate (unless of course the program is changed, but I'm speaking as it stands now.). Everyone gets to sell to the same number of customers with a discount as any other mfr. I see it almost as an advantage. Look at the cult Tesla already has. They have their charging network and we are all lined up around the corner. Once others get on board and have a govt rebate to offer it might just force Tesla to get their assembly line together and produce a less buggy car. GM might get their act together and design one you aren't ashamed to be caught in.
 

DXF

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#7
I couldn't even finish the article because it is written with such stupidity. I quote:

"The result is that it eventually ends up penalizing automakers who were first movers and invested more into electric vehicles since their customers will not have access to the incentives while automakers who were late to market with EVs end up with a competitive advantage."

No one is penalized, ever. Tesla and GM will get to sell 200,000 EV's just like any other manufacture will get 200,000 sales with the $7500 rebate (unless of course the program is changed, but I'm speaking as it stands now.). Everyone gets to sell to the same number of customers with a discount as any other mfr. I see it almost as an advantage. Look at the cult Tesla already has. They have their charging network and we are all lined up around the corner. Once others get on board and have a govt rebate to offer it might just force Tesla to get their assembly line together and produce a less buggy car. GM might get their act together and design one you aren't ashamed to be caught in.
Normally I'm on the "not penalized" bus when people cry out that' they're being penalized. However in this instance, whether you call it 'penalized' or not, the heavily staggered nature of these $7500 rebates are going to distort the market prices badly. It's already happening to an extent but the upcoming results are going to be far worse. In economics that's typically known a Very Bad Thing.

These values and schedules were written over a decade ago. That's a very long time for government economic policy to see out ahead, periodic reworks are typically needed to adjust to contemporary situations. *shrug*

Note: That's not to say I'm for the "just lift the lifetime cap on $7500". That doesn't make sense, either. The un-rebated vehicle prices are too low for such a number to not create large issues, the % is just too damn high IMO.
 
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#8
if you look at the original purpose of these rebates, I think it is fair to say that they have met their objective. To keep the marketplace stable it seems that setting a 2-year sunset for everything would be the smart move.
 

Dan Detweiler

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#9
Its an interesting move. I think with Tesla and GM getting closer to the end Congress might very well kill the whole thing next year. I think there are 2 paths forward that fit into a political 'America-first' mindset (I'm not endorsing the mindset just showing how it might emerge in legislation).

1. Kill the whole thing. 2 US car makers have benefited from it, but it really has been a tax break for the more affluent so just kill it and claim 'fiscal responsibility'.

2. Reset the program with a universal rebate and fixed end date, maybe 2 years out. Make it as simple as anything before 12/31/2020 or some such end date. This is at least a 'level playingfield' for the US manufacturers.

Either step is good for Tesla but the 2nd is good for us too.
The ironic thing is that it looks like Tesla, GM and Nissan will all hit the magic 200,000 number in very close succession. It would not surprise me in the least if the entire tax incentive program got scrubbed next year. If that happens, the companies that it is really going to hurt (at least in the American market) will be the ones relatively new to EVs like Jaguar, VW, BMW, Fisker, Farady, etc. I think you would see these manufacturers shift their focus to the European and Chinese markets.

The battery price points are almost to where the EVs will stand alone competitively without incentives with comparable ICE cars. When we hit that point it is game over for the ICE manufacturers I think. Will that happen by next year? Maybe...maybe not, but certainly in the next two to three. I think the writing is on the wall for the legacy auto manufacturers and now it's a matter of playing catchup.

Dan
 

DXF

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#10
The battery price points are almost to where the EVs will stand alone competitively without incentives with comparable ICE cars. When we hit that point it is game over for the ICE manufacturers I think. Will that happen by next year? Maybe...maybe not, but certainly in the next two to three. I think the writing is on the wall for the legacy auto manufacturers and now it's a matter of playing catchup.
Tesla's current thinking on the price difference on 500 mile vs 300 mile range Semi suggests they are expecting sub-$100 cost battery. Even at the reasonable bottom end of projections for battery size for the 500 mi version, 800kWh battery (top end of estimate is 1MWh), that's $94/kWh to the customer for the $30K upgrade. If Tesla gets the Semi out the door within 2 years from now at about that price that's still 5-6 years ahead of the Bloomberg estimate from last summer! Very clearly they've got something cooking inside that others don't think they have. Whether it's designer psychedelics or a battery breakthrough we'll find out by maybe late 2020.

A $90kWh battery probably does reach the ICE-EV build price tipping point. It'd knock about $4600-$5000 off the current estimated cost for the Model 3 LR battery pack, unclear how much it'd knock off retail since Tesla's $9K upgrade cost from the SR clearly has some margin padding in it.
 

RolfS

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#11
I don’t think congress is going to change anything in this program. Congress is pretty much broken. I won’t hold my breath anyway.

What Tesla needs to do is to insure that as many waiting US reservations as possible get the credit, by selling as many of the cars to other countries now, minimizing the numbers they sell to US customers. That will insure that Tesla has more time to get the model 3 production line up to speed. Then once they hit the 200,000 car limit sell as many cars to the US market at full production speed during the 6 month (and so on..) phase out period. There is no limit on the number of cars sold that get the credit once the phase out stage begins. It’s just as many as you can sell that will have the credit.
 
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#19
H.R. 6274 has been introduced to extend the EV Tax Credit beyond the 200,000 car limit. I encourage everyone to contact their representatives to support this bill. There may be a hope for rebate on the elusive base model.