By on November 6, 2017

electrify-america-ev-charging-station, Electrify America

As reported last week, House and Senate Republicans have proposed sweeping tax reforms that would, by extension, kill the EV tax credit if the bill passes into law. Automakers have already expressed their distaste on the matter, and now they’re beginning to mobilize to keep it from becoming a reality. With electric vehicles just beginning to gain traction, and numerous manufacturers banking on the platform in the years to come, losing the credit would undoubtedly harm sales.

The Electric Drive Transportation Association, a group representing automakers, suppliers, technology firms, and energy concerns, says it will collaborate with its members and their shareholders to ensure the credit persists under the proposed GOP reform. Genevieve Cullen, the association’s president, claims the group will pull out all the stops to ensure the Senate sees things their way. 

“If the whole underpinning of tax reform is to promote jobs, investment and innovation, the credit is doing exactly that,” she said in an interview with Automotive News, highlighting that more than 215,000 people are employed in EV development.

Her fear, and the concerns surrounding those she represents, are that the United States would lose its innovative might to China and Europe — both of which are progressing into electrification at a more accelerated rate. By abolishing the tax credit in the U.S. she believes consumers will have less reason to purchase EVs, crippling a burgeoning segment within the industry that’s been hoisted up by Wall Street.

In October, General Motors announced plans to launch over 20 new all-electric and hydrogen fuel cell units by 2023, including two in the next 18 months, as part of its global push in the zero-emission field. Volkswagen Group plans to introduce 30 new EVs, split between VW and Audi, by 2025 — accounting for nearly a quarter of its fleet. Ford wants to put 13 electrified vehicles on the market within the next five years. Obviously, those companies don’t mind having a leg up, and having the government incentivize those vehicles is a big help.

“Nissan has made significant investments in the development of market-leading electric vehicles and public charging infrastructure to support EV drivers,” Nissan spokesman Brian Brockman said in a statement. “We support continuing measures that help encourage greater adoption of EVs given the benefits they can provide such as lowering vehicle emissions and reducing America’s dependency on foreign energy sources.”

“Tax credits are an important customer benefit that can help accelerate the acceptance of electric vehicles. Because General Motors believes in an all-electric future, we will work with Congress to explore ways to maintain this incentive,” GM said in a release.

Still, automakers don’t really have to explore the best way to save the tax credit. Those companies already know lobbyists will be key in breaking into the cold and fickle hearts of lawmakers. Industry representatives are expected to swarm on congress all week, hoping to protect their respective interests and curry congressional favor.

[Image: Volkswagen Group]

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51 Comments on “Automakers Trying to Stop GOP From Killing EV Tax Credit...”


  • avatar
    FreedMike

    Welcome to the Drained Swamp Era.

    • 0 avatar
      brettc

      I like the more accurate term of swamping the drain.

    • 0 avatar
      volvo driver

      Since Tesla is near the end of it’s 200k vehicle tax credit alotment, ending it now for everyone else who is way behind would give Tesla a huge advantage. Go for it GOP.

      • 0 avatar
        orenwolf

        Exactly this. Law of unintended consequences at work here. GM and Tesla will have enjoyed the EV credit and the sales generated by it, and all new entrants will see a markup in their vehicles.

        Careful what you wish for, folks.

        • 0 avatar
          FreedMike

          Gosh darn Republicans…why do they want to make it harder for American Industry to make money?

          • 0 avatar
            highdesertcat

            Yet I hope that the GOP can swing it and KILL that EV tax credit.

            I’ve always said that EVs should be available to anyone who wants to buy one, but without the taxpayer subsidy.

            I’m not optimistic. The GOP does NOT have a stellar record for governance.

            There’s too much infighting within the GOP and too many anti-Trumpers.

            I’d be surprised if the GOP can manage to get anything of any consequence passed AND signed.

            In the mean time, the Lefty Libbies are walking around in a stupor with blown minds about how Trump bypasses everyone and talks directly to “we, the people.”

            Gotta love the drama!

          • 0 avatar
            Car Guy

            The government needs to stay out and let the market decide. No more taxpayer money to create artificial demand. Nothing worse than the government picking winners and losers in technology. They are inept and will screw it up.

          • 0 avatar
            FreedMike

            “Nothing worse than the government picking winners and losers in technology. They are inept and will screw it up.”

            This message delivered to you by the loser technology known as “the internet,” which was a government invention.

      • 0 avatar
        TrailerTrash

        OK…couple things we need to address.
        Thanks to my news sources….

        Unless you are willing to admit the rich pay for most of the taxes in the USA, then you will have to finally admit the poorest are subsidizing cars for the rich. The Tesla, bot large and small, are cars of and for the rich.

        Tesla is also unique in that its cars are priced for the very wealthy, with base price for its Model S of about $75,000.00. And today the model 3 is still NOT a reality…much less an affordable one.

        Next, you have to realize since Tesla is now widely sold, in reality the non green states, mostly ave taxpayers, are in reality subsidizing the purchase of cars in the green states.

        And yes, although any company that desire to get into the green car/electric car build could and would receive the benefits of the tax incentive…ONLY TESLA survive COMPLETELY on this.
        Tesla has no other offerings. It is only tax subsidies that allow it to survive.

        And here is a little bit of info I ran across…”Also not good optics was the recent announcement of Tesla’s negotiators to open a plant in Shanghai’s free trade zone. Why not instead enlarge and improve the Fremont plant that seems to be having production problems? Elon Musk says that Tesla will avoid Chinese import tariffs if it makes cars in China for the Chinese market. Problem is that China deems cars made in Shanghai’s free-trade zone to be foreign made, thus incurring a 25% import tariff if it sells the cars in the rest of China. So they really wouldn’t save on import duties after all. By the way, compare China’s 25% tariff to our 2.5%, and you’ll see that Trump is right when he says China doesn’t play fair on trade”

        Good Ol Trump is correct.

        “Tax credits are an important customer benefit that can help accelerate the acceptance of electric vehicles. Because General Motors believes in an all-electric future, we will work with Congress to explore ways to maintain this incentive.”

        If you believe…YOU PAY the investment…not me.

        ” And if an industry doesn’t have a survival strategy for coping in a post-subsidy environment, perhaps it shouldn’t exist. The alternative is a perpetuation of the sort of crony-capitalism that President Trump promised to abolish.”

        Go for it…GOP.

        • 0 avatar
          FreedMike

          “If you believe…YOU PAY the investment…not me.”

          OK, but the thing is: if this works, and it ends up adding to the bottom line of the manufacturers, suppliers and dealers who will all make money off these cars, you’ll be one of the winners. Think about it.

    • 0 avatar
      28-Cars-Later

      Seems to be some standing water, need some Drano.

  • avatar
    SCE to AUX

    Realistically, under the current law GM, Nissan, and Tesla would all see their vehicles’ eligibility for a subsidy evaporate in the next 1-2 years anyway. They are the ‘established’ players, with Ford and BMW not far behind.

    It’s the laggards in this space (those who aren’t interested in losing money on EVs) who suffer the most if the subsidy goes away.

  • avatar
    Robbie

    This is simply part of the post-American world. Europe and China will now take over moral and economic leadership and will lead the world in science and innovation, while America sinks into backward Republican irrelevance in every possible aspect imaginable.

    • 0 avatar
      Cactuar

      What are the incentive levels on EV’s in Europe and China?

    • 0 avatar
      Sigivald

      Nothin’ says “moral and economic leadership” and “science and innovation” like “subsidies for uncompetitive products”, right?

      (Moral leadership? If we want that, we can build nuclear power plants. Electric cars running off coal aren’t moral leadership even for a *green*, let alone anyone else.

      Economic leadership? Subsidies pretty much undercut any claims to it being the goal.)

      • 0 avatar
        volvo driver

        Like the billions in subsidies we pay out to the oil industry every year. Good point, Einstein.

      • 0 avatar
        FreedMike

        At one point, computers were “uncompetitive” too, you know.

        Taxpayer money fixed that problem. And the first wave of early ’80s PCs were supported by tax credits much like the ones being done for EVs.

        And we all know how that just absolutely obliterated the PC market.

        EVs are gonna happen. The only question is whether the demand for them will be filled by American companies or ones overseas.

        If we’re smart, we spend a few bucks to make sure it’s American companies cashing in. Or we can be stupid and save a few bucks now.

        • 0 avatar
          Car Guy

          Tax credits for buying home PCs in the 1980s? I call BS. No such thing.

          • 0 avatar
            Arthur Dailey

            I do remember in Canada that there were tax incentives for purchasing new computer equipment prior to Y2K.

          • 0 avatar
            FreedMike

            The credit was for business use.

            And it put a HUGE number of early-’80s computers on desktops, which a) helped the manufacturers amortize their R/D costs, and b) spurred demand for PCs in general. As a result, computer manufacturers were able to bring out faster and cheaper machines FAR more quickly than they could have if “the unfettered market” been the driving force at work.

            Now, would you say that We The People have recouped that initial “tax investment”? I sure would.

            Same basic thinking behind incentivizing EVs.

  • avatar
    deanst

    Someone should tell the guy in the photo that he doesn’t have to hold the “nozzle” when he is filling his car up with electricity.

  • avatar
    deanst

    I call bullsh*t on the claim that 215,000 people are employed in EV development. I bet it’s a highly generous accounting of the real number of people. There were fewer EV cars sold than people employed – if you believe the claim.

    • 0 avatar
      Sigivald

      I can believe it, if only because the big automakers like to posture around Electrics and have teams, even if they don’t sell many.

      (And I bet some of said “in EV development” people also do work that applies to hybrids … which don’t need subsidies to compete *and* improve/create/provide much of the technology that EVs can use.)

    • 0 avatar
      highdesertcat

      “I call bullsh*t on the claim that 215,000 people are employed in EV development.”

      Most of those people have more than one job within an organization. IOW, they’re double-counted. Like an employee who has more than one responsibility within the formal organization.

  • avatar
    qwerty shrdlu

    Don’t forget that “development” includes people pouring concrete and installing plumbing in new factories, and even working on highly generous accounting.

  • avatar
    I_like_stuff

    When we mean “cut spending” we mean cut spending for stuff that benefits the other guy, not me!!
    – Everyone in America

  • avatar
    stingray65

    Every time I have commented about EV’s being total dependent on Government subsides I can always be sure to get one or more of the following comments:
    1. “Government “investment” created the Internet and PC markets” (FreedMike)
    2. EVs deserve subsidies because the government also subsidizes “big oil”, “big coal”, farmers, defense contractors and other undeserving entities.
    3. We are all going to be left behind by China, Germany, Norway if we don’t out-subsidize them on EVs.
    4. Tesla has never ever relied on any subsidies.

    Funny thing is I’ve provided links many time to a variety of sources that repudiate all these points, and yet the usual suspects keep coming back with the same tired arguments (without any cites). If EVs are so great they shouldn’t need subsidies, unfortunately the best available evidence suggests they are not very green, battery development is slower than hoped, and infrastructure costs are going to be far higher than any EV supporter is ever going to be willing to pay for. In times of huge government deficits, I think cutting subsidies for rich people to buy new green cars is very well justified, and I would be happy to have many other subsidies also killed. Let the Chinese and Germans go broke subsidizing uncompetitive EV technology.

    • 0 avatar
      FreedMike

      No, government “investment” did not create the Internet and PC markets. If there was no demand for either, then neither would exist.

      Government investment ****made it possible for companies to develop government-developed or government-funded tech, like the Internet or microcomputers at a far more rapid rate than if there had been no government investment or intervention, bringing these products to market a lot sooner.****

      And it made a whole bunch of Americans filthy f**king rich. If you have any tech stocks in your 401k, you’re wealthier because of all that big bad gummint stuff.

      THAT’S what the government did in relation to tech. It made it easier for people to make money. If you want to make it harder, then just say so. I’m sure “the market” will take care of that.

      It’s exactly what it’s trying to do with EVs. There is clearly a market for them because people are buying them. And as far as the “tax credits are the only reason people are buying EVs” argument is concerned, tell me, Stingray: would YOU spend anywhere from $30,000 to $100,000 on a car that sucked simply to get a tax credit?

      I didn’t think so.

      And we’re going to “go broke subsidizing EV tech”? Wow…I didn’t know it was that big a line item in the federal budget. Must be right up there with social security or defense.

    • 0 avatar
      Car Guy

      Stingray – don’t bother giving facts to him. It interfers with his emotions…..

      • 0 avatar
        Arthur Dailey

        Hold on, in the USA are there not or were there not considerable tax advantages gained in purchasing very large vehicles (Suburbans, full size pick-ups, etc) because they could be depreciated faster/counted as ‘work’ vehicles?

        • 0 avatar
          azmtns

          You are correct. It’s referred to as Section 179 depreciation. See http://www.section179.org for more details.

          • 0 avatar
            ToddAtlasF1

            And it’s a travesty, and it needs to be stopped just like EV tax subsidies need to be stopped. It won’t happen because the Detroit two would be the Detroit zero within two quarters without tax incentives on overpriced pickup trucks.

          • 0 avatar
            Art Vandelay

            What percentage of pickup buyers are actually in a position to claim this. They sell an awful lot of trucks to individuals and would continue to do so if this went away.

          • 0 avatar
            FreedMike

            Ah, I see…so Todd Atlas thinks businesses shouldn’t be able to write off equipment anymore (which is exactly what Section 179 is for).

            How was the Comintern meeting, comrade?

      • 0 avatar
        Arthur Dailey

        Hold on, in the USA are there not or were there not considerable tax advantages gained in purchasing very large vehicles (Suburbans, full size pick-ups, etc) because they could be depreciated faster/counted as ‘work’ vehicles?

    • 0 avatar
      volvo driver

      “Let the Chinese and Germans go broke subsidizing uncompetitive EV technology.”

      We’ll just go broke handing out tax cuts to billionares and giant corporations. It’s the Murican way.

  • avatar
    Big Al from Oz

    Its a myth to think government subsidies accelerated the current situation.

    The current computer, smart phone, robotics, AI, etc revolution would of occurred globally without any government assistance.

    People who harp on about how subsidies created current tech are really spanking themselves.

    The reality is, subsidies and protection are only offered when an industry is uncompetitive against other players.

    The US needs to work out what it needs to produce, like all other countries should.

    Trump during a game of golf with Abe demanded the Japanese should buy more American cars. But maybe Trump should realise America needs to build what others want, then the odds improve in selling the Japanese cars.

    EVs are no different. Build an EV with the same level of user friendlyness as a ICE at the same price and they will sell.

    Don’t subsidise as industry becomes reliant on subsidies and considers it income. Subsidies and protection is a job and innovation destroyer.

    • 0 avatar
      volvo driver

      “The current computer, smart phone, robotics, AI, etc revolution would of occurred globally without any government assistance”

      Oh really? Guess who paid for the initial development of the microprocessor, the internet, GPS, radio miniaturization, touch screens. Guess who is still the biggest source of funding for AI research? Your big bad dirty gubment tax dollars.

      • 0 avatar
        Art Vandelay

        Guess why most of that research is done? To ensure our bombs and bullets hit their intended targets…not out of some altruistic desire to change the world. Guess we should pump up the Military’s budget if we want to innovate.

      • 0 avatar
        FreedMike

        Of course that stuff would have been developed.

        But with the government paying the bills, it got developed far more quickly. And it got developed in the U.S., not overseas.

        How did this benefit the economy? Well…how much tax revenue, how many jobs, and how much wealth has been created as a result of the development of the computer industry? It’s incalculable.

  • avatar
    mcs

    Wait until the Saudis and the Iranians start blowing the living crap out of each other’s oil terminals. No subsidies needed at that point.

  • avatar
    Caboose

    Isn’t the downside of being the capitalist in a capitalist system that you undertake the risk? Isn’t one of the problems with government subsidies (of anything) that it socializes the risk while privatizing the rewards?

    I don’t dispute the claim that early government investment – particularly from the military – lead to a lot of advances in tech (communications, PCs, robotics, GPS, the Internet). But my understanding is that, once those first big leaps were made, the military investment dried up and the government’s role was recast as that of a buyer taking bids. In other words, they moved to being a large customer playing in a competitive market.

    But with EVs, the big first steps have already been made. So maybe it’s time the government’s role shifted to that of buyer. There is talk of “leadership”. Okay, what if we ended the subsidies but the federal government committed to buying as many EVs as practical and incentivizing States to do likewise. For example, it would cost the Feds $0 to declare to the States, “Y’all need to have your State fleets be, I dunno, 5% EVs by 2023 if you want to keep your highway funds”. The feds do that stuff all the time.

    Taxpayer money would be saved, Big customers with consistent needs over time would be created, and they would buy into a competitive market. My point is that there are ways of accomplishing the social engineering some favor without raking the taxpayers over the coals.

    • 0 avatar
      volvo driver

      “My point is that there are ways of accomplishing the social engineering some favor without raking the taxpayers over the coals.”

      How is allowing people to keep their own hard earned money suddenly “raking the taxpayers over the coals”? You get an A+ for mental gymnastics.

    • 0 avatar
      FreedMike

      “Isn’t one of the problems with government subsidies (of anything) that it socializes the risk while privatizing the rewards?”

      That’s not a problem – it’s an ADVANTAGE. This country is set up so that people and companies can make money. That’s the whole point. Government investment or involvement in targeted industries just accelerates the process. And in so doing, it creates jobs and wealth. Generally speaking, that more than pays for whatever the tax investment was.

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