Infrastructure Bill Would Spend $174 Billon to Promote EVs in US

[Rhidan]

Some bullet points from President Biden's proposed Infrastructure Bill being announced today:

• $174 Billon investment to compete with China and win the EV market
• New consumer point-of-sale rebates and tax incentives for purchasing American-made EVs
• Grants to retool U.S. factories to build EVs and batteries for EVs
• Grants and incentives to private sector/local government to build new national network of 500,000 EV charging stations by 2030
• Convert 20% of school busses to EVs; and convert federal fleet vehicles to EVs

https://www.whitehouse.gov/briefing...2021/03/31/fact-sheet-the-american-jobs-plan/

• Create good jobs electrifying vehicles. U.S. market share of plug-in electric vehicle (EV) sales is only one-third the size of the Chinese EV market. The President believes that must change. He is proposing a $174 billion investment to win the EV market. His plan will enable automakers to spur domestic supply chains from raw materials to parts, retool factories to compete globally, and support American workers to make batteries and EVs. It will give consumers point of sale rebates and tax incentives to buy American-made EVs, while ensuring that these vehicles are affordable for all families and manufactured by workers with good jobs. It will establish grant and incentive programs for state and local governments and the private sector to build a national network of 500,000 EV chargers by 2030, while promoting strong labor, training, and installation standards. His plan also will replace 50,000 diesel transit vehicles and electrify at least 20 percent of our yellow school bus fleet through a new Clean Buses for Kids Program at the Environmental Protection Agency, with support from the Department of Energy. These investments will set us on a path to 100 percent clean buses, while ensuring that the American workforce is trained to operate and maintain this 21st century infrastructure. Finally, it will utilize the vast tools of federal procurement to electrify the federal fleet, including the United States Postal Service.

https://www.nytimes.com/2021/03/31/business/economy/biden-infrastructure-plan.html

A decade ago, Mr. Obama’s economic stimulus plan spent about $90 billion on clean energy programs intended to jump-start the nation’s nascent renewable power and electric vehicle industries. Mr. Biden’s plan now proposes spending magnitudes more on similar programs that he hopes will take those technologies fully into the mainstream.

It bets heavily on spending meant to increase the use of electric cars, which today make up just 2 percent of the vehicles on America’s highways.
The plan proposes spending $174 billion to encourage the manufacture and purchase of electric vehicles by granting tax credits and other incentives to companies that make electric vehicle batteries in the United States instead of China. The goal is to reduce vehicle price tags.

The money would also fund the construction of about a half-million electric vehicle charging stations — although experts say that number is but a tiny fraction of what is needed to make electric vehicles a mainstream option.

Mr. Biden’s plan proposes $100 billion in programs to update and modernize the electric grid to make it more reliable and less susceptible to blackouts, like those that recently devastated Texas, while also building more transmission lines from wind and solar plants to large cities.

It proposes the creation of a “Clean Electricity Standard” — essentially, a federal mandate requiring that a certain percentage of electricity in the United States be generated by zero-carbon energy sources like wind, solar and possibly nuclear power. But that mandate would have to be enacted by Congress, where prospects for its success remain murky. Similar efforts to pass such a mandate have failed multiple times over the past 20 years.

The plan proposes an additional $46 billion in federal procurement programs for government agencies to buy fleets of electric vehicles, and $35 billion in research and development programs for cutting-edge, new technologies.

https://www.barrons.com/articles/tesla-stock-ev-biden-infrastructure-plan-51617198987

Wall Street will likely focus on the incentives. There is already a federal tax credit of $7,500 for EV purchases, but the credit runs out after a company sells 200,000 EVs. Tesla, for instance, has sold too many EVs for Tesla buyers to get the $7,500 federal credit, though several states still have their own incentives.

The size of the new credit and any vehicle cap, or lack of a cap, isn’t included in the White House summary. But $174 billion is a lot of money for the sector: It works out to about $580,000 per plug-in EV sold in the U.S. in 2020. Of course, a lot of the $174 billion will end up in things such as charging infrastructure.

Roughly 300,000 plug-in electric vehicles were sold in the U.S. in 2020. That number is expected to grow rapidly. Wall Street, for instance, expects Tesla deliveries to rise about 60% year over year in 2021.


Wedbush analyst Dan Ives expects the federal tax credit to go up to $10,000. He also expects the tax credit ceiling of 200,000 per manufacturer to be phased out. That ” will restore the EV tax credits for stalwarts Tesla and [ General Motors ],” added Ives his Wednesday report.

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[LoneStar]

$10K tax rebate sounds good to me. Probably the only "upside" that I'll ever see from Uncle Joe

 

[mkhuffman]

I totally oppose this waste of our tax money. Why isn't the free market enough? It is enough for our $1,000 mobile phones and our grocery stores that are overflowing with food.

And let's be real: those of us able to purchase a Rivian do not need any sort of hand out from our fellow taxpayers. The guy working at McDonald's who pays taxes does not need to subsidize my $90,000 EV purchase. He cannot afford it, and our government should not force him to do it. Sorry to be political, but this post is political and I can't just see it and ignore it.

That said, you know I will take whatever they are offering because the government already takes so much from me. It will be a little refund of all the taxes I have paid to our wasteful government in the past.

 

[Trandall]

I totally oppose this waste of our tax money. Why isn't the free market enough? It is enough for our $1,000 mobile phones and our grocery stores that are overflowing with food.

And let's be real: those of us able to purchase a Rivian do not need any sort of hand out from our fellow taxpayers. The guy working at McDonald's who pays taxes does not need to subsidize my $90,000 EV purchase. He cannot afford it, and our government should not force him to do it. Sorry to be political, but this post is political and I can't just see it and ignore it.

That said, you know I will take whatever they are offering because the government already takes so much from me. It will be a little refund of all the taxes I have paid to our wasteful government in the past.

In Rhidans defense I disagree that this thread needs to be overtly politically divisive. For better or worse the reality is neither U.S. auto manufacturing, energy, nor transportation, especially nor groceries are free market in this country, and if you think your mobile phone is don't forget sanctions on Huawei phones, govenment incentives for telecoms to update to 5G... Also concerning the spirit of the statement about a guy working at McDonalds I think you will find that his tax liability would be zero or even less than zero if he had dependents based on the EIC so it is not accurate that he would be subsidizing your tax credit in the way it's implied. Again not trying to be divisive here just trying to keep some semblance of reasonable factual-ness.

 

[Rhidan]

This was just supposed to be an informative post about some major plans to promote EVs in the US, including potential changes to rebates and incentives when buying an EV.

Let's try to keep the politics out of it. I disagree a lot with what is being said here, but I don't plan to respond because this post was just trying to be informative.

 

[Trandall]

This was just supposed to be an informative post about some major plans to promote EVs in the US, including potential changes to rebates and incentives when buying an EV.

Let's try to keep the politics out of it. I disagree a lot with what is being said here, but I don't plan to respond because this post was just trying to be informative.

My apologies if my previous post was a "tank Turn" to your thread. I read it as being from an informational standpoint as well. I to am not endorsing all the proposals.
However I openly support the need to spend money on DC fast charging infrastructure. I feel infrastructure spending for national projects is solidly in the wheelhouse of what I am expecting my representatives to spend my tax money on.

 

[sevengroove]

@Rhidan I appreciate this post, and agree that we can keep things - uh, apolitical while still discussing the content. Regarding the incentive increase, I do agree with @mkhuffman that those who can afford an $80-90k vehicle do not need an extra $2.5k tax credit. I hope they adopt a more regressive credit structure to more highly incentivize cheaper EVs, while dropping off the incentive amount the more expensive the vehicle is. For example (completely hypothetical):

• Vehicle MSRP of under $50k => user gets the full $10k credit
• Vehicle MSRP from $50k - $70k => user gets the standard $7.5k
• Vehicle MSRP over $70k => user gets $6k

This way the credit is prioritized for cheaper mass-market EVs and can be availed of by a larger percentage of the population who actually needs it. Thoughts?

 

[Trandall]

to Sevengrooves point I think the intent should be to keep the incentive only large enough to bridge the gap in cost disparity between an ICE vehicle.

 

[Rhidan]

Regarding the incentive increase, I do agree with [USER=1626]@mkhuffman that those who can afford an $80-90k vehicle do not need an extra $2.5k tax credit. I hope they adopt a more regressive credit structure to more highly incentivize cheaper EVs, while dropping off the incentive amount the more expensive the vehicle is. For example (completely hypothetical):

• Vehicle MSRP of under $50k => user gets the full $10k credit
• Vehicle MSRP from $50k - $70k => user gets the standard $7.5k
• Vehicle MSRP over $70k => user gets $6k

This way the credit is prioritized for cheaper mass-market EVs and can be availed of by a larger percentage of the population who actually needs it. Thoughts?

Yea we only have the fact sheet, not the text of any bill, but I thought this sentence was interesting:

It will give consumers point of sale rebates and tax incentives to buy American-made EVs, while ensuring that these vehicles are affordable for all families and manufactured by workers with good jobs.

That suggests to me they might be considering some means testing for the EV rebate or limitation on MSRP. I think everyone would agree you don't need an incentive for a $110,000 Hummer EV or a $200,000 Roadster. An MSRP limitation also might create some more price competition for the OEMs to price a vehicle below a certain price point.

And in fairness to the politics point, I didn't mean to shut down a discussion of the needs/merits of this EV proposal. I just didn't want this to turn into a vapid conversation about taxes, free markets, and big government.

 

[Riviot]

I totally oppose this waste of our tax money. Why isn't the free market enough?

Let's be honest with ourselves, we haven't been a "free market" since the 1800s and not a single developed nation is a completely "free market." Hell, even that gas and oil drilling going on down in Texas has been subsidized since the 1920s. It's just a retooling of where "we" want subsidies to go. In this case, moving toward "cleaner" production and energy use.

I will Literally buy another Rivian or a Tesla M3 to replace my wife's Civic in 2022 if we go to $10k for all electric manufacturers. Seems like a great boost to American economy and manufacturing if you ask me.

 

[sevengroove]

Hell, even that gas and oil drilling going on down in Texas has been subsidized since the 1920s. It's just a retooling of where "we" want subsidies to go. In this case, moving toward "cleaner" production and energy use.

 

[mkhuffman]

And in fairness to the politics point, I didn't mean to shut down a discussion of the needs/merits of this EV proposal. I just didn't want this to turn into a vapid conversation about taxes, free markets, and big government.

Your post will naturally instigate a "vapid" conversation about taxes, free markets, and big government because the bill you are so interested in raises taxes, damages free markets, and expands an already too large government. How can you post it and not expect it to be political?

In any case, it is a horrible bill and there is NOTHING in it I support. Our government is going to steal another $2+ TRILLION from the taxpayers in order to help rich people drive expensive cars. And yes, increasing taxes on the corporation that owns a McDonald's will result in a higher tax burden on all the employees that work there. And yes, the abundance you see at your local grocery store is because of free market economics and NOT because of taxes and regulations. And oil companies are not subsidized at all.

I say we delete this entire original post and get back to being focused on why we are part of this forum: Rivian and the vehicles they have designed. They are building some awesome products and we should be focused on that, not some left wing crazy tax and spend proposal that is going to bankrupt us all.

 

[sevengroove]

And yes, the abundance you see at your local grocery store is because of free market economics and NOT because of taxes and regulations.

Without those "regulations", you'd be shitting your pants trying to figure out where to charge your new Rivian. The entire Electrify America network only exists because VW ran afoul of emissions regulations.

And oil companies are not subsidized at all.

Yes, they are.

 

[jjwolf120]

And oil companies are not subsidized at all.

When you say things like this, I know that you are delusional and all of your posts should be ignored. Subsidies are everywhere and in almost all business categories, from airplanes to sports franchises etc.

 

[Acon]

And oil companies are not subsidized at all.

Your post will naturally instigate a "vapid" conversation about taxes, free markets, and big government because the bill you are so interested in raises taxes, damages free markets, and expands an already too large government. How can you post it and not expect it to be political?

In any case, it is a horrible bill and there is NOTHING in it I support. Our government is going to steal another $2+ TRILLION from the taxpayers in order to help rich people drive expensive cars. And yes, increasing taxes on the corporation that owns a McDonald's will result in a higher tax burden on all the employees that work there. And yes, the abundance you see at your local grocery store is because of free market economics and NOT because of taxes and regulations. And oil companies are not subsidized at all.

I say we delete this entire original post and get back to being focused on why we are part of this forum: Rivian and the vehicles they have designed. They are building some awesome products and we should be focused on that, not some left wing crazy tax and spend proposal that is going to bankrupt us all.

And "oil companies are not subsidized at all?" Probably the most untrue statement I've seen here.

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