Senate $40k cap on ev tax credit

[bigdogrod]

yup i'm out. was counting on that 7500 and hoping it would go to 12k. thanks sleepy joe for boning us! hopefully this crap will get fixed, or i'm getting my deposit back and watching from the sidelines.

update: turns out wasn't all the a.i.c. damn republican got me too :

from electrek:

As part of the new federal budget, the US Senate approved an amendment introduced by Senator Deb Fischer (R-NE) to introduce a limit on the price of electric cars eligible to the $7,500 federal tax credit.

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[Sdvictor]

No he wouldn’t

Actually Biden likely would. This was pushed by senate republicans and largely seen as a push to deter EV sales

 

[DaveA]

Upcoming:
Nissan Ariya
Ford Lightning
Tesla Cybertruck

Available Now:
Chevy Bolt EV
Chevy Bolt EUV
Hyundai Ioniq Electric
Hyundai Kona Electric
Kia Niro EV
Nissan LEAF
Tesla Model 3

Very unlikely that this will survive as proposed. With forces pushing to expand the Tax Credit and others to reduce/limit it, the most likely result is no change.

Also add Fisker Ocean, to be built by Magna in Austria ($37,500 Sport model) and Fisker Pear Project ($30k) to be built with Foxconn in the US.

 

[bigdogrod]

it also leaves chevy and ford out with their trucks, plus hummer. i'm thinking they will push back and this bill will fail so that us middle class can actually afford the r1t/ r1s. if not i'm buying the smokiest diesel around and rollin coal... lol

 

[Ladiver]

I still haven't read it, so please excuse my ignorance.

Does anyone know if the $100K is for an individual or household? Many times, when they say $100K, that would be for a single taxpayer and $200K for a household. This makes a little more sense. If it is $100K for household, then MANY more families will be cut out.

 

[AdamsFan1983]

So rather than incentivize middle class Americans to buy flashy American made EVs, we’ll incentivize lower income Americans to buy foreign made EVs that nobody wants.

 

[Attesan997]

I still haven't read it, so please excuse my ignorance.

Does anyone know if the $100K is for an individual or household? Many times, when they say $100K, that would be for a single taxpayer and $200K for a household. This makes a little more sense. If it is $100K for household, then MANY more families will be cut out.

For now its non binding, the House still has to take a crack at it. What they end on is likely to look different than anything disclosed so far. It's very unlikely the tax break will be objectively worse AFTER the sitting POTUS drove around a BEV on the South Lawn and he/Team Detroit all got on TV to say how much they were pushing for faster EV adoption. But stranger things have happened so who knows what it will be once passed.

 

[Gshenderson]

The union made provision is the one that irks me the most. There’s absolutely no reason for that other than pure political pandering to reward big union donors. Made in America is Made in America. Shouldn’t matter one squat whether it was made by union or free market labor. Total BS. And I’ll likely be cut out of any benefit if they have any income limits. But the union BS irritates me more than not getting the credit due to income.

that being said, I do agree with the other points about the income limits actually not incenting what they are trying to incent.

 

[Blueassassin]

The union made provision is the one that irks me the most. There’s absolutely no reason for that other than pure political pandering to reward big union donors. Made in America is Made in America. Shouldn’t matter one squat whether it was made by union or free market labor. Total BS. And I’ll likely be cut out of any benefit if they have any income limits. But the union BS irritates me more than not getting the credit due to income.

that being said, I do agree with the other points about the income limits actually not incenting what they are trying to incent.

only union electric car would be the Lightning correct?

 

[srwaxalot]

only union electric car would be the Lightning correct?

I would think GM and VW would/are union shops.

 

[DucRider]

Union provision is not on the table at the moment.
The non-binding amendment just passed didn't bring that provision back to life.

 

[Zybane]

$40K for a car these days is nothing. I mean Tesla's bare bones zero optioned lowest Model 3 barely squeezes in.

 

[AndroidAppBundle]

I can see the reasoning for this. China has a ton of EV brands that have prices as low as $4000 USD. The affordability and number of choices have enabled hundreds of millions of Chinese consumers to switch to EV. In USA, complete opposite; there are only a select few EV models that could be considered affordable. Most of them have exhausted their tax credits (Chevy, Nissan). It is safe to say; none of them have strong appeal. It is a total playground for the affluent and wealthy Americans.

All the flurry of EV activity in USA continues to focus on these relatively small segment of affluent customers. In 2020, only 30k Model X were sold, and only 6k original E-tron models. If America plans to ever take electric vehicles seriously; it will never happen if the only vehicles with appeal are priced at 55-65-85k.

I can see how this looks like a shot at Rivian; but it is a shot to the entire industry. The government is saying - quit focusing all your efforts on bringing just these high margin luxury models. This is just as much a shot at Rivian, as it to Ford, Audi, Mercedes, and even GM/Chevy.

Finally, these tax credits have been controversial as of late. If we stop to think what vehicles still qualify, what price points they exist at, and who is buying them; a pattern emerges. The federal government is subsidizing EV models for rich people, and giving rich people $7500 off their purchase. And oh yeah; there are zero affordable models that still qualify for these tax credits. Poor people need not apply. So are we using our tax credit funds in the best possible way? Not really. We're never going to have momentum in the industry if "all the EV owners" live in Bellevue Washington, Palo Alto California, Brooklyn New York, and Austin Texas.

I agree with the governments choice here. I understand vehicles are capital intensive, and it is appealing to develop high margin luxury models to generate cash flow to build out the rest of the brand - Tesla did it. Brands can still develop these models, they just won't be subsidized by the government.

With the Mach-E made in Mexico, most every Volvo model made in Sweden, Hyundai in South Korea, etc - I also would be in favor of a built in America requirement. Oddly enough; Tesla, Chevrolet, and Rivian will be the only brands manufacturing EV in America. Audi/VW will eventually upgrade the Tennessee plant to manufacture the ID4 and Q4 Etron.

Ford, Lordstown, Cadillac, GMC and Lucid have plants coming online for EV as well - but oh yeah....that trend reappears - all those plants coming online will be making vehicles from $39,974 (F150 Lightning EV) to $169,000 Lucid Air Dream.

IF there isn't a cap on vehicle price, and there isn't a made in America requirement; it will take a century for EV to be more than 50% of vehicles on the road, and decades for EV infrastructure to get built.

 

[AndroidAppBundle]

I make more than 100k a year. My last vehicle purchase was a brand new hybrid that cost less than 30,000 with tax and title.

If you live in a HCOL area; garbage truck drivers make $100k.

I live in a low cost of living area. So I am probably further going against your idea that more affluent people should not purchase a vehicle for under 40k.

Maybe I am weird; but I do not like taking on a significant amount of debt, for what is typically a rapidly depreciating liability. A Rivian R1S will be more than two times the cost of my current vehicle. This is why I give Rivian such a hard time, and critical eye. If I am going to step up and pay for the Gucci experience, then I want my pillow fluffed.

Laughable, just shows how out of touch they are. No idea how to stimulate industry. Just pandering.

On top of that, people who make <100k a year shouldnt buy 40k vehicles...

 

[AndroidAppBundle]

Most of the models already exist, and have had their tax credits exhausted. I think that points to the problem, right?

Chevy Bolt
Chevy Bolt EUV
Nissan Leaf
Ford Lightning F150 EV ($39,974 starting price. Made in USA)
Volkswagen ID4 ($39,995 starting price. Soon to be made in USA)
Mini Cooper SE
Hyundai ioniq


Honda has E model in Europe. Speaking of Europe; Europe and China have tons and tons of affordable EV models that allow more people to own electric vehicles.
https://www.carmagazine.co.uk/electric/cheapest-electric-car/

For Americans; no vehicle manufacturers have affordability or accessibility in mind when it comes to electric vehicles. If there is not a carrot and stick incentive; the transition away from fossil fuel vehicles will take centuries.

No manufacturer has plans to introduce a <$40k EV with reasonable range in the next few years, so this is basically like not even having an EV incentive at all. EV adoption in the US will most certainly stall in the US while it rips in Europe. This can't possibly be the outcome with dems in charge.

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