By on November 2, 2017

electric car charging smart car

It’s the last thing Elon Musk wants to hear and it’s likely not something General Motors will be too pleased about. Contained within the tax plan introduced by House Republicans Thursday is the elimination of a huge driver for electric vehicle sales — the $7,500 EV tax credit.

Automakers, and especially the two mentioned above, already stood to lose their credits in the near future (there’s a 200,000-vehicle-per-manufacturer cap), but the new tax bill would see the buyer incentive permanently removed, not renewed, as many had hoped. Such a move could slam the brakes on a still-fledgling segment in the U.S.

The tax bill is aimed at simplifying the tax landscape. In it, House Republicans propose cutting the corporate tax rate and paring down the number of tax brackets to three, among other measures.

According to Bloomberg, Michigan Republican Mike Bishop said it’s his understanding that the EV tax credit would disappear immediately once the bill is passed into law. Under the existing plan, once an automaker hits 200,000 EVs, the credit is cut in half every six months until it’s gone. Tesla is already on track to lose its credit next year, with GM and Nissan being the next to follow.

Going by recent examples of jurisdictions scrapping or reducing tax credits for green vehicles, the move could spell rough waters for any automaker. While ultra-expensive EVs could still make a profit, the newness of the technology, plus the steep (but declining) of batteries means low-priced models like the Tesla Model 3 and Chevrolet Bolt are already selling at a loss. It’s been reported that GM loses $9,000 on every Bolt.

The goal of automakers is to lower the cost of manufacturing through economies of scale, and that requires many people lining up to buy a new EV. For the public to do that, the vehicle must first be affordable. Getting $7,500 off MSRP can really sweeten the pot, especially with low-end EVs.

Among domestic manufacturers, Ford and GM plan on introducing a fleet of electric vehicles in the near-to-mid term. Tesla has new models in the works, including a pickup. As well, many other established automakers plan to do the same, including Volkswagen, Nissan and Volvo. Naturally, much skepticism surrounds the actual buyer demand for such vehicles, given the fledgling state of the infrastructure needed to make the vehicles viable on a day-to-day basis. The possible elimination of a large financial incentive only serves to heighten the doubt.

Tesla’s stock, already bruised by Wednesday’s admission of slower-than-anticipated production of the Model 3, sank nearly 8 percent in Thursday trading.

In 2015, Denmark announced it would phase out its 180-percent import tax exemption on electric vehicles over the course of four years, ending in 2020. The result? EV registrations plunged in early 2016, to the tune of 80 percent. A further reduction in the number of citizens buying electric cars followed in each successive quarter.

The change in buying habits mirrored that of the State of Georgia, which saw its Low Emission Vehicle Tax Credit expire in 2015, followed by a cratering in EV demand. Currently, 11 U.S. states offer a tax credit for the purchase of an EV; most recently, New York and Texas. Still, these incentives are much lower than the federal credit.

Automakers aren’t happy when they invest billions of dollars into product development, only to see the government disincentive those very products. Expect to see much lobbying in the days ahead from industry groups.

GM spokesman Pat Morrissey told Bloomberg that tax credits “are still necessary to help grow the EV market.” However, environmentalists — who aren’t in the business of selling cars — aren’t all in agreement.

“It helps to have EV tax credits, but fuel economy standards are more important,” said Daniel Becker, director of the Safe Climate Campaign. The lobby group’s reasoning is that, if EVs represent less than 1 percent of new vehicle sales, a larger environmental impact would come from making combustion engine vehicles more efficient.

Some automakers, like Nissan and Mazda, are working on squeezing more distance from a drop of gas using variable compression and gasoline compression ignition technology.

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117 Comments on “Say Goodbye to EV Tax Credits Under New GOP Tax Plan...”


  • avatar
    eggsalad

    Interesting that the photo shows a smart ED. The only car left in smart’s USA lineup is an EV. Say goodbye to smart USA entirely.

    • 0 avatar

      … Which is too bad. The smaller and more lightweight the car, the more it benefits in terms of needing less batteries, less time to recharge. The cheaper to produce and purchase, probably not needing financial incentives too. I can understand Musk’s early-adopter approach by wanting to cater to the more affluent and more receptive clientele. But it takes Tesla far too long to come up with a true lightweight EV. The Model 3 still tips the scale at 25 times the average driver’s weight.

  • avatar
    SCE to AUX

    Nissan, GM, and Tesla’s future products are already assuming the Federal subsidies will have evaporated for their nameplates. So it’s not like they’ll stop development on those.

    The examples of Denmark and Georgia are extremes that EV bashers like to cite when discussing subsidies. Denmark’s tax hiatus on EVs effectively reduced the price 64%, so naturally eliminating that exemption would kill sales. Likewise, Georgia’s generous $5000 subsidy made buying a $35k Leaf pretty easy, especially when the Feds were kicking in another $7500.

    However, even in more *normal* situations, there is no doubt subsidies enable sales; I wouldn’t have leased my Leaf in 2012 without them. While I am philosophically opposed to subsidies, I’ll happily pick up money that’s laying on the table.

    It is also well known that EVs can see a sales uptick in Q4 as the tax year closes. Perhaps I’ll join the ranks of 2017 buyers and run out and get a new…. (rhymes with “colt”).

    • 0 avatar
      APaGttH

      This. As I understand it GM is getting close to the end of the line on the tax credits as it is.

    • 0 avatar
      Lorenzo

      There are certain other benefits of EVs that might be taken away. There’s a move to exclude the exemption for EVs to use HOV lanes, for example, and while there’s no need for smog testing of pure EVs, there’s talk of adding safety inspections that would include EVs. States that had safety inspections but dropped them for smog tests alone shouldn’t have done so. A poorly maintained car is just as dangerous as bad air.

      • 0 avatar
        AtoB

        “There are certain other benefits of EVs that might be taken away. There’s a move to exclude the exemption for EVs to use HOV lanes, for example, and while there’s no need for smog testing of pure EVs, there’s talk of adding safety inspections that would include EVs. States that had safety inspections but dropped them for smog tests alone shouldn’t have done so. A poorly maintained car is just as dangerous as bad air”

        The problems with state mandated inspections are money and time. Here in CA regular smog checks are running $60-80 (without coupon) for 12 minutes of mostly automated testing! Specialty checks are more expensive. Some shops have fine print charging extra for arbitrary reasons (minivan, pre 2011, 4wd, whatever)

        Time is also an issue as there can be a lengthy line during popular hours.

        If you car passes you get no benefit other than the privilege of being allowed to use or sell it. I like my air clean like the next guy but come on!

  • avatar

    Great ! An EV would not suit my driving needs, so I will be happy to end the use of my tax dollars to support a product that I would not buy because it does not suit my needs.

    • 0 avatar
      vvk

      > end the use of my tax dollars

      Excuse me, but it is not YOUR tax dollars. Perhaps other tax credits should be eliminated, too? Like child care tax credits, mortgage interest, student tuition, healthcare insurance. Do you feel like YOUR tax dollars support products like houses, child care, medicine and universities when other people pay less taxes because they use or buy these products?

      • 0 avatar
        I_like_stuff

        Agreed. All tax credits should be eliminated. The federal govt should not be in the business of subsidizing people having children or buying homes or buying a Tesla.

        Enough with this silliness that if a tax credit goes away somehow the world will end. People bought houses before the MID. Somehow people with kids managed to survive up until the 90s when the child tax credit was introduced. And if EVs are truly the wonderous things Tesla and Co claim they are, they’ll be fine without tax credits.

        Get rid of them all in exchange for lower rates.

        • 0 avatar
          vvk

          I can’t help but notice that you did say anything about doctors. Yes, US government is subsidizing the health insurance industry and by extension the medical system.

          • 0 avatar
            I_like_stuff

            And it shouldn’t.

            The most expensive thing is the one that is provided for free by the govt.

          • 0 avatar
            Mandalorian

            I don’t see what good my tax dollars are doing keeping a bunch of drugged-up, obese, chain-smoking alcoholics going.

            Ask any doctor, what sucks up the vast majority of money in healthcare is not cancer, genetic diseases, or accidents, it’s consequences from 100% preventable lifestyle choices.

          • 0 avatar
            FreedMike

            We’re all human. We’re all fallible. We all have “lifestyle choices.”

            Either we commit to shared risk, or we commit to paying our own way. Have right at the latter…do you have a couple million stashed away, by chance? You’ll need it.

          • 0 avatar
            Lou_BC

            “I don’t see what good my tax dollars are doing keeping a bunch of drugged-up, obese, chain-smoking alcoholics going.”

            Someone obviously does not know the definition of addiction and personal/genetic and/or socioeconomic factors that lead to it.

        • 0 avatar
          Kevin Curry

          You’re not going to see lower rates, I guarantee you don’t make enough money.

          • 0 avatar
            28-Cars-Later

            Yawn. Wake me when the Visigoths are on the border.

          • 0 avatar
            golden2husky

            …..Someone obviously does not know the definition of addiction and personal/genetic and/or socioeconomic factors that lead to it…

            Lou, those factors certainly are a part of that particular problem, but many times, no. I see plenty of well off people with lifestyle choices that are just that, choices. And many of them have high-dollar medical bills attached to them.

            This tax gift to the wealthy is just another club to the baby seals’ head of freedom in the US. The plan is to get the alt right firmly established and establish their horrific agenda. Look at the number of traditional Republicans that have announced that they will no longer run for re-election. The tax plan that kills the middle/ upper middle class. The move to kill the Johnson amendment that will allow churches to support political causes outright (fine, take the tax exempt status away from the freeloaders)…just wait until Muller gets fired and the Russia probe ends. We are witnessing the destruction of American democracy. This is just the beginning.

      • 0 avatar
        CKNSLS Sierra SLT

        I agree with “jcwconsult”. I don’t wish to pay for some ones else’s electric car.

        As more models come out-they need to stand on their own merits.

        As far as other deductions-we have 600,000 school children here in Utah-and the entire population is 3 million. So yeah-I’m getting a little tired of school taxes as well. They need to go to a “head tax” after three kids-and the electric cars need to stand on their own merits.

      • 0 avatar
        stuki

        No perhaps about it.

      • 0 avatar
        Lorenzo

        I hope you don’t work for government.

        That attitude, “it’s not my money”, is what’s wrong with government at every level. It is the job of government employees to be prudent stewards of the public purse that holds THEIR taxes as well as everyone else’s.

        Any person with that attitude needs to be separated from public service. Private citizens who have the attitude that government money appears by magic have no standing to complain about government at all.

      • 0 avatar
        johnnyz

        Credits and deductions are two very different animals. Do you homework grasshopper.

      • 0 avatar
        kamiller42

        vvk,
        I’m not sure you understand the difference between a tax credit and tax deduction. Your list throws them all in the same pot as a tax credit. Apples and oranges.

    • 0 avatar
      mcs

      @jwconsult: Isn’t the $7,500 incentive a way to allow hard-working individuals to keep more of the money they earned rather than giving it to the government?

      • 0 avatar
        vvk

        @mcs: Exactly! It is not like the government is paying EV owners or giving them a discount off the vehicle price. It just allows them to pay less tax. I bet most of the people who argue against EV tax credits also think that taxes are bad and should be lower.

        I guess it is somewhat different when you lease. The logic of the way it (EV tax credit) works with leasing has always been a mistery to me.

        • 0 avatar
          MBella

          Actually it is paying. It’s $7500 that the government was otherwise legally entitled to. This isn’t the same concept as a state providing a tax break to a company. That company would otherwise go elsewhere. The EV would just not buy an EV.

        • 0 avatar
          johnnyz

          A credit is cash in your pocket. A deduction is money that you do not pay tax on.

          • 0 avatar
            healthy skeptic

            @johnnyz

            >> A credit is cash in your pocket. A deduction is money that you do not pay tax on.

            By that logic, a deduction is also cash in your pocket, just much less than a credit. In the end, both have the effect of reducing your tax bill.

      • 0 avatar
        MrGreenMan

        It has always been considered a fair trade from the right to eliminate specific, targeted tax incentives in favor of a simpler, flatter system.

        As I said once before here to much consternation of the commentariat: the way the feds regulate most of our behavior is manipulation through the tax code. That’s why it is so byzantine. They want certain behavior; they go get the Cass Sunsteins of the world to advise them on how to manipulate us, and then they enshrine it with carrots and sticks in the tax code. People on the right believe that government shouldn’t tell you what to do with your money in this manner; it’s up to moralism outside of government to direct your behavior.

        The EV industry has had long enough. Time’s up. Present a competitive product that people will buy or give up this reliance on indirect government subsidy.

        • 0 avatar
          brandloyalty

          “As I said once before here to much consternation of the commentariat: the way the feds regulate most of our behavior is manipulation through the tax code. That’s why it is so byzantine. They want certain behavior; they go get the Cass Sunsteins of the world to advise them on how to manipulate us, and then they enshrine it with carrots and sticks in the tax code. People on the right believe that government shouldn’t tell you what to do with your money in this manner; it’s up to moralism outside of government to direct your behavior.:

          Except of course that the givernment IS the people. Not some independent malicious corporation as the right wing would have you believe. That position separates people from the only tool they have to protect themselves from corporations, who move into the power vacuum created as citizens are alienated from their government.

      • 0 avatar
        JimZ

        “@jwconsult: Isn’t the $7,500 incentive a way to allow hard-working individuals to keep more of the money they earned rather than giving it to the government?”

        only if the $7500 goes in his pocket. then it’s his “hard earned money.” If it goes into anyone else’s pocket it’s “socialism.”

    • 0 avatar
      MoparRocker74

      BINGO. No electric/hybrid can offer me anything. If the kool aid drinkers want to pony up their own dough for this then fine. But why should I be on the hook for even one red cent of someone elses choice? Otherwise, I want a $7500 tax credit to buy whatever I want. I pay at LEAST that much in federal/state income taxes and then some annually so that’s my money in the first place. Better to be invested in a new Challenger or Ram 1500 than in some politicians pocket.

      • 0 avatar
        volvo driver

        “But why should I be on the hook for even one red cent of someone elses choice? ”

        You really have no idea how tax credits work.

      • 0 avatar
        golden2husky

        ..But why should I be on the hook for even one red cent of someone elses choice…

        How about the tub who spends the last five years of their shortened life sucking the teat of the medical system because they never did a minute of cardio in their life? I have no interest in subsidizing those who could have helped themselves yet didn’t…

        • 0 avatar
          JimZ

          Medicare and Social Security is one of those things old people will claim “isn’t socialism” because* it’s somehow “them getting back the money they put in.” Which is bonkers. the money they put in was spent a long time ago on the people who were old then. The money they’re “getting back” is the money I’m paying in right now. And I’m fine with that, just drop the cognitive dissonance and dishonesty and call it for what it is. Especially since the Boomers (who are all getting old now) didn’t put in near enough money to cover their aging, diabetic, hypertensive hind ends.

          (* the real reason, of course, is because it benefits *them.*)

          • 0 avatar
            Charliej

            Jim, your anger at us old farts is misplaced. A few years back while I was still working, I had a younger person tell me that I should die and get out of the way of the people who needed good jobs. As I owned a business at that time, i don’t think that I was denying anyone a chance at a job. I did retire at 66, shut down the business, sell everything and move to Mexico. You whiners about how much the old farts are costing you can go to hell. Down here I do not use Medicare, I pay all of my bills. My dad’s dad lived to 103, my dad made it to 94. I am in my seventies and plan to be around for quite a number of years. So I want all of you young people to continue to work hard and support all of us undeserving old farts. Your turn at old age will be here before you know it, if you are lucky. So when you get pissed off about having to support us old farts, just think of me sitting down here in Mexico sipping margaritas and enjoying your tax money.

  • avatar
    vvk

    > It’s the last thing Elon Musk wants to hear

    Actually, this would put Tesla in an even more competetive position. Since their EV tax credits are close to being used up anyway. If the EV tax credit is eliminated, other manufacturers lose the competitive advantage.

  • avatar
    DearS

    I don’t think it’s unfair not remove the taxes, but yeah sales will drop. They may have been helping us move in the direction of EVs a lot faster, which is great cause low oil prices won’t last forever. I am ok either way.

  • avatar
    I_like_stuff

    Good!!

    About time we stopped subsidizing Elon and his sycophant Tesla owners. You want to the cool new shiny toy? Pay full price for it.

    • 0 avatar
      SCE to AUX

      How do you feel about subsidizing Mary Barra and her sycophant Chevy owners, or Carlos Ghosn and his sycophant Nissan owners?

      Because all those sycophants have received more handouts than Tesla’s sycophants.

      Never mind; it’s more fun to play the class envy card.

      • 0 avatar
        I_like_stuff

        Class envy? LOL. Not long ago I was called all sorts of names because I own a luxury car. Now I’m a rich guy hater.

        I love the internet.

        And yeah, get rid of all of the subsidies for everyone. But have you seen a Bolt owner act with even 1% of the a-$$-hole quotient of a Tesla owner? Yeah me neither. It’s not the amount of 0s in their bank accounts I hate about Tesla owners. It’s their grade A a$$-hol0 status.

        • 0 avatar
          SCE to AUX

          So it’s just straight-up prejudice against a class of owners, just like some people hate BMW owners or dually-pickup drivers. Fair enough.

        • 0 avatar
          brandloyalty

          The only Tesla owners I’ve met were very nice people who were also interesting to chat with. Unlike many of the cranks here.

          • 0 avatar
            Ubermensch

            Ditto. Good friends of mine owns a Tesla and they are two of the nicest and most generous people I have ever met.

        • 0 avatar
          MoparRocker74

          I haven’t seen any Bolt owners, even here in Portlandistan. So there’s that. Besides, the prius asshole factor cant possibly be topped.

          • 0 avatar
            golden2husky

            I guess you aren’t surrounded by BMW drivers then…most people dislike Prius drivers because they equate them with being a “tree hugger”..I frankly would consider that a compliment but the truth is most Prius drivers choose their car for economic operation and access to the HOV lanes. Speed wise, Prius drivers around here are in the top 20%. For every hypermiler there are 10 hybrids in the left lane vying for space to shorten their commute…me included, minus the Prius…

    • 0 avatar
      volvo driver

      Who is we? How much are you paying exactly?

  • avatar
    slavuta

    I wish they stopped subsidizing ethanol. Good riddance. Why gov must help someone to make or sell product? Let EV makers figure out how to make and sell these cheaper.

    • 0 avatar
      dwford

      Yes. The government subsidizes ethanol and then ALSO mandates its usage. Insane

      • 0 avatar
        redmondjp

        You can thank Archer Daniels Midland and their ilk for this. Use the force of law to ensure a guaranteed market for your product. It’s what the health insurance industry also has done now. So don’t forget to vote this week!

        • 0 avatar
          stuki

          We can thank a government that can rob the productive to pay the connected for this. Not some individual company. The latter will always avail themselves of opportunities to make a profit. It’s the former’s ability to rob on their behalf, that constitutes the problem.

    • 0 avatar
      volvo driver

      I wish we would stop subsidizing the oil industry.

      • 0 avatar
        mcs

        @volvo driver: Hey, my oil subsidies pay for my EVs! True story. I actually used some of the money from my oil and natural gas royalties plus the subsidy money to pay for them. However, I do agree with you. I’ll be fine without the subsidies.

  • avatar
    don1967

    A sad day for false economies, influence peddlers and the forced redistribution of wealth in general.

  • avatar
    tomLU86

    “…government disincentive those products”

    Disincentive? Really?

    Is the govt slapping a tax on electric cars? NO. It’s just removing a tax break.

    The govt has been ‘disincentiving’ all other cars for years.

    Ethanol is bad for many cars, yet it’s subsidized.

    We are drowning in a glass of water. Society in general, and govt in particular, can’t be all things to all people.

    We are broke.

    The EV subsidy, like EVs, is sham. If they are so great, they can make it on their own.

    Every night, that EV has to get plugged in. At the other end of the outlet is a gas powerplant, if you’re lucky. More likely, it’s coal, which is dirty. It may be nuclear, which is toxic.

    Our relatively cheap gasoline has, as JH Kunstler says, resulted in the ‘biggest misallocation of resources in history’. Suburban sprawl.

    it’s not sustainable. Slap a $1 gallon tax on gas now, while it’s cheap.

    People will use less, and the air will be cleaner.

    There is no free lunch. EVs will not be the panacea the elite like to think.

    However, EVs and autonomous will make it easier for the 1% to REALLY control the mobility of the rest of us. Better to pay more for gas now and preserve some mobility in the future than to be lead down the primrose path of ‘cheap gas today’ , and when that blows up in our face, EV/Autonmous for some tomorrow.

    • 0 avatar
      FreedMike

      “However, EVs and autonomous will make it easier for the 1% to REALLY control the mobility of the rest of us.”

      Uh…how, exactly?

      “The elite” can’t control what people want. If they could, then Jeb Bush or Hillary Clinton would be in the White House right now. And even setting all the environmental benefits of EVs, I really like the idea of a car I can just plug in every night. So do a lot of other people. As the technology gets more advanced, even more folks will agree.

      (And as far as EV’s “not being an environmental panacea” is concerned, that’s right…for now. But as renewables become more prevalent – and don’t kid yourself, with the amount of non-government money that’s behind that movement, that check is in the mail – they’ll prove very beneficial.)

    • 0 avatar
      vvk

      > Slap a $1 gallon tax on gas now, while it’s cheap.

      $1/gal is not nearly enough in the US. Americans are rich. The most popular car in America is a $40k pickup truck with a 5 liter V-8 and 4WD.

      • 0 avatar
        Big Al from Oz

        vvk,
        Any change in taxation that has a significant impact on an industry should be incremental and measured. It took Australia 30 years to wind back protection of our auto industry and our taxes and levels of protection were similar to the chicken tax on pickups.

        Also, fuel tax in Australia is indexed to rise every year by a small margin. Maybe in 30 or 40 years it will have doubled in price.

      • 0 avatar
        johnnyz

        Gas tax in MN is already over $1 per gallon. They divert that money to boondoggle light rail projects. MN sucks!

  • avatar
    mmreeses

    from a non-political, and purely practical, point of view. want to help the environment?

    Subsidize insulation or high-efficiency furnaces/water heaters. More bang for you buck than EV. —especially since other countries are full steam ahead to subsidize EV.

    And to toss in my $0.02….blow up the entire tax code and start from a clean slate. no itemization and your first $20k of income is tax-free, three brackets to make things revenue neutral. (based on where the 75th and 95th percentile of income are)

    Of course many will not be happy on every political side as there will be lots of losers. Precisely why it would never pass in the real world.

    • 0 avatar
      APaGttH

      Or subsidize CNG conversions of vehicles. I’d convert to CNG TOMORROW if the government subsidized the conversion cost (it is low 5-digits so you would have to drive a ridiculous amount of distance to justify it)

      • 0 avatar
        Big Al from Oz

        APaGttH,
        That occurred in Australia, all that happened was with the $1500.00 subsidies conversions went from $1800.00 to $3000.00.

      • 0 avatar
        AtoB

        “Or subsidize CNG conversions of vehicles. I’d convert to CNG TOMORROW if the government subsidized the conversion cost (it is low 5-digits so you would have to drive a ridiculous amount of distance to justify it)”

        CNG fuel isn’t that easy to find in a lot of places making road trips a problem. The tanks also need to be recertified or replaced 2-3 times over the life of the car which isn’t cheap.

        The good news is used CNG vehicles tend to be cheap.

  • avatar
    brandloyalty

    I’m ok with removing subsidies from electric cars, if we also get rid of the patchwork of similar programs. These include: mileage regulations, cash for clunkers, hov lanes, road tolls.

    Each of these has real and perceived inequities, which makes all of them fodder for an epidemic of belly-aching.

    The goal is to reduce consumptiin of fossil fuels. So the solution is simple: carbon taxation. The solution to the automatic complaint that carbon taxation is a communist plot/tax grab/blah blah, is to make it revenue-neutral. Every cent collected goes back to the taxpayers. Adjust the amount of the tax to achieve the effect needed.

    British Columbia, a province in Canada, started this years ago. BC’s economy has done much better than the Canadian average, while per-capita carbon emissions have fallen. The sky has not fallen. Simple. And it works.

  • avatar
    CKNSLS Sierra SLT

    I agree with “jcwconsult”. I don’t wish to pay for some ones else’s electric car.

    As more models come out-they need to stand on their own merits.

    As far as other deductions-we have 600,000 school children here in Utah-and the entire population is 3 million. So yeah-I’m getting a little tired of school taxes as well. They need to go to a “head tax” after three kids-and the electric cars need to stand on their own merits.

    • 0 avatar
      el scotto

      Hey, some of those Mormon women are hot! That may explain why so many children. Paying for public education is a lot cheaper than paying for welfare and/or incarceration. 4 year public college, Jr college, and 2 year technical schools turn out students who get jobs, pay taxes, and contribute to society. Them young’uns had better be working overtime. My Social Security?medicare will need to be paid.

  • avatar

    Goodbye tax credits. Goodbye yellow brick road. The road to hell is paved with tax credits.

  • avatar
    el scotto

    Oh My Dear Sweet Jeebus! What a bunch of whiners. The alt-right has people believing that government provided “common goods” like roads, schools, and police/fire department are in some way a mockery and that in the end they really shouldn’t be paid for with tax dollars. One more phrase that will cause shrieks with accompanying hand-wring and teeth-gnashing: “Keynesian Economics”. Donning my left-handed catchers mitt.

  • avatar
    FreedMike

    Well, say goodbye to EV tax credits IF these guys can actually agree on a budget.

    We’ll see about that. So far, far as I can tell, they can’t agree on what time to break for lunch, much less an actual policy. And it’s been that way for a long, long time.

    But we’ll see what removing these credits does to the market. My take? It’ll sting, but it won’t come anywhere near killing it. This is particularly true of Tesla. If you can afford a $100,000 car, a $7500 tax break isn’t going to do much for your monthly budget. People who think this is the reason why Tesla has been the success it has (and it has, folks…don’t kid yourself) are deluded, at best.

  • avatar
    sgtjmack

    If I’ve read one comment saying it’s about time and time for them to stand on their own, I’ve seen a hundred. And I can say that I agree.

    Now, don’t get me wrong, I don’t mind if the government assists an underdog for a short amount of time, u til they can get on their own, but it has been several years now, at least ten, that the federal and many State and local governments have been subsidizing cars along the alternative spectrum from the hybrid to electric and others. If they can’t sell on their own by now, it is time to sink or swim without the help of the tax payers.

    If these manufacturers are having a hard time getting the prices down, then maybe they should scale back a little, or a lot and offer stripped down trim levels. Not all cars NEED pw/pl/a.c./c.c./infotainment b.s.or even a radio at all. I’m sure you’ll sell a ton of crank windows and manual locks and a simple a.m./f.m. radio with two speakers. Many people want a simple, utilitarian vehicle to go from A to B, and dont want to pay thousands of dollars for things that they don’t seem necessary to travel.

    • 0 avatar
      Big Al from Oz

      sgtmack,
      What about pickup truck protection? You must be equitable in how you approach these sorts of things.

      This is a problem for many.

    • 0 avatar
      arach

      I hear enthusiasts saying all the time that “man people want a simple, utilitarian vehicle”.

      Where are these people? The poorer the person, the more options they want on their Kia. I just see nothing to support this theory.

      I know some people claim the reason people don’t buy the stripped down versions is because the dealers don’t have them on their lots. The dealers say they don’t have them on the lots because they dont sell them or don’t make money on them.

      Those who REALLY want a stripped down car that I know, buy used anywhere because they are cheap.

      So where are these NEW car buyers looking for the stripped down cheapest cars possible? I’m sure some exist, but I have a hard time seeing it as “many” people.

      • 0 avatar
        Ubermensch

        A friend of mine is very cheap and bought a base 2011 Subaru Outback and there is no way I could live with that vehicle. Antiquated 4-speaker stereo that sounds worse than the system in my 1987 Accord and no lumbar support on the very uncomfortable seats. Miserable.

      • 0 avatar
        golden2husky

        Nobody is interested in a cheapo car anymore other than Internet warriors…

  • avatar
    sgtjmack

    Here’s another thing. If you want to use government incentives to get your company going, then you and all of your executives must live on a modest income, somewhere in the neighborhood of around $50-60k a year until the company is up and running on its own and all government loans have been paid in full and all incentives have stopped. Then and only then can you take home more than the said amounts. Because if you can afford to live in a million dollar plus house and wear thousand dollar suites then you can afford to run your company on your own dime.

    • 0 avatar
      jonnyanalog

      +1 I think there needs to be an imposed salary cap for executives. If not, the gap between the 1%ers and the common working stiff will continue to grow. The top 1% make what like 271% more than the common working stiff. Thats insane. Why should they reap all the benefit from someone else’s hard work?

      • 0 avatar
        Kendahl

        The only thing an arbitrary salary cap will accomplish is to discourage competent people from taking leadership positions. The best CEO I ever worked for told his vice presidents that an 80 hour work week was expected at their level. Would you be willing to give up everything else in your life if the return was no greater than time and a half for the second 40 hours?

        • 0 avatar
          AtoB

          “The only thing an arbitrary salary cap will accomplish is to discourage competent people from taking leadership positions. The best CEO I ever worked for told his vice presidents that an 80 hour work week was expected at their level. Would you be willing to give up everything else in your life if the return was no greater than time and a half for the second 40 hours?”

          Hmmm, 60hrs/wk for $100k, long commute no golden parachute or 80 hrs/wk for $1M, shorter commute (because you can afford to live closer) and golden parachute?

          Choices choices…

  • avatar

    I want Government to subsidize turbo engines and high end audio systems. Oh and do not forget about android phones.

  • avatar
    Big Al from Oz

    This is what happens when you put in place systems and models that are counter productive to what you want as an end result. I can say the same regarding the US pickup market and how much is offered in protection and subsidies.

    Corn farmers, dairy, US forestry, etc.

    I’m not saying to remove some protection and subsidies, but they must be well considered. If a reliance on such systems and models becomes evident, then it’s time to wind back the artificial support.

    In the end it isn’t cheaper to us tax funded programs for capitalistic adventures.

    If no subsidies were offered for any motor vehicle in the US the US would still play an important role. Many on this site consider assembly an essential to having product. But the US can design and engineer. The US economy would be far better off without these low paying jobs and focus on better paying jobs in the economy.

    All that money wasted on EVs and pickups/automobiles would of been better spent on education and health. This would provide for a better US economy.

    Look at why the middle class is shrinking. It robotics, why is the US not leading in industrial/commercial robot design and manufacturer. Oddly the US has some of the worlds best IT, scientist, engineers. Concentrating on the future is far more important than a aluminium F150 or EVs production. Cars and even 75% of pickups are no different than a smart phone, TV or fridge. They are all consumable products to be manufactured by the cheapest way, so we can improve our standard of living and improve the standard of living of others who are needy.

  • avatar
    Elliot86

    Yeah, keep voting against your own self interest, guys! Fail.

  • avatar
    thornmark

    Elon Musk hardest hit – the special interests aren’t gonna like it.

    Big win for the American people.

    • 0 avatar
      Big Al from Oz

      thronmark,
      I do believe in a “leg up” to help an industry, but reliance on it’s existence via subsidies, protectionism and using tax dollars isn’t the way to go.

      There are better ways to make EVs more attractive. One would be to increase fuel taxes incrementally and gradually remove the EV subsidies. You could then remove CAFE.

      The US pickup industry has been reliant on the Chicken Tax for nearly 40 years. But yet the people who don’t like the EV subsidies are generally the guys who support the Chicken Tax.

      • 0 avatar
        thornmark

        I didn’t like Solyndra either.

        My neighbor has a new Tesla X and she just bought a beach home in RI last Srping. I love her but she doesn’t need a subsidy. She turned in a Q8.

        I’m sure she wouldn’t have gotten an X w/o some form of tax credit. And I’ll bet it’s a “prestige lease” that allows her to get out of it early if she wants. Like w/ the Q8.

      • 0 avatar
        DenverMike

        “The US pickup industry has been reliant…”

        @BAFO – That was literally the stupidest thing I’ve ever heard on these pages!

        If you’re referring to Detroit or “Big 3” pickups, what exactly is the connection between their success and the Chicken tax??

        Even the quite limited “success” of Toyota and Nissan fullsize pickups can’t possibly have any relation to the Chicken tax.

        If you’re referring to midsize pickup sales, I still don’t see the Chicken tax affecting much. But please explain.

        Dramatically increasing the fuel tax is the 2nd most stupid thing I’ve heard here.

        Lumping EV subsidy “supporters” with chicken tax supporters, who ever they are, some ghostly figures in your mind, which were probably already “old dudes” during the Kennedy Administration, is the 3rd most stupid thing I’ve heard.

        Although killing off CAFE would “balance out” the ending of EV subsidies. Sort of. Ending NAFTA should also coincide with the death of CAFE.

        Except the current administration totally bent on collecting the most fines/taxes/revenue, with the least outlay.

  • avatar
    Dan

    It’s a good start.

    Slapping a $7,500 penalty on the shysters who claimed this in the past would be an even better finish.

  • avatar
    Big Al from Oz

    If the tax credits dry up where will Tesla be? Tesla is struggling.

    • 0 avatar
      VW4motion

      I’m no Tesla fan boy, and I’d probably never own a Tesla. But, to say Tesla is struggling defines fake news. People are on a year waiting list for the 3 and other models people are waiting months on end. If you mean “struggling” as in keeping up with demand. You could be onto something.

      • 0 avatar
        redmondjp

        No, you are wholly swallowing the fake news from Musk that nothing is wrong. They are in SERIOUS manufacturing-line trouble, if you bother to read the stories online from inside sources.

        I don’t see them ever attaining the production goals that Musk has stated, without plowing significant additional funds into the plant.

        I live within a sea of Teslas and I like them. But the company is in very deep trouble. When they are purposefully dialing back production of their two other models (which supposedly they are making money on), you know that things are getting bad.

    • 0 avatar
      volvo driver

      Yeah Tesla is stuggling so bad the stock is over $300 and market cap larger than Ford. Poor Tesla.

  • avatar
    orenwolf

    I’d argue this affects Tesla and GM least of all, as AFAIK they were approaching the delivery limits on those subsidies anyway, right?

    This has a larger effect on new entrants to the sector, as they won’t enjoy the assistance Tesla and GM had in pricing assistance for their vehicles. In effect this may further entrench the existing players even further in their lead in the EV space, IMHO.

  • avatar
    energetik9

    I think I’m most surprised that Texas, of all places, offers a state tax credit for EVs.

  • avatar
    Car Guy

    I would be in favor of extending the credit if it was capped at MSRP of 40K. The idea someone buying a 100K Tesla getting free money is B.S.

    • 0 avatar
      vvk

      Only people who pay enough federal income tax would get the credit. So, even with the cap you are suggesting, the credit would go to people who would/could buy a 100K Tesla.

      Unless you lease…

      • 0 avatar
        Car Guy

        You are over complicating things. Not based on income tax brackets, not lease payments amounts – MSRP only. If it’s over 40K MSRP you get zero. If it’s under, you get the tax credit.

  • avatar
    VW4motion

    Looking at the grammar in these postings is a damn shame. Those that actually believe TTFM – trump the f-ing moron is making America great again are proving his sales pitch wrong with every key stroke.

    • 0 avatar
      arach

      Conveniently, I can barely comprehend your post. I’m not sure if that was meant as a form of irony, or if “TTFM – trump the f-ing moron” really is your version of writing excellence. If it is the latter, I urge you to consider the acquisition of a mirror. If it is the prior, then I am not quite sure your point is easily communicated, although that is your prerogative.

      • 0 avatar
        VW4motion

        Keeping you head in the sand is just a defense mechanism when someone knows they’ve been taken. TTFM is actually what his own team thinks of his thought process.

    • 0 avatar
      Car Guy

      The only moron I see here is your attempted comment…..

  • avatar
    jmo

    My bet is the subsidies are just a convenient excuse for the Tesla bashers. If the subsidies end and sales continue, it won’t change their opinion one whit.

    The real reason they object is their fear of anything new.

    • 0 avatar
      redmondjp

      Fear of anything new? You do realize that electric cars have been around for over 100 years, right?

      At the current rate of production, it will take 481 years to meet all of the reservations for the Model 3.

      #notgunnahappen

      The company will run out of cash, go bankrupt, sell off its assets, and all vehicle production will move to China.

    • 0 avatar
      MoparRocker74

      What’s ‘new’ exactly about underperforming, ugly econoboxes? ‘New’ should mean ‘better’. There isn’t an EV or hybrid Id be caught dead in, because I’m a muscle car and 4×4 guy. If it doesn’t have that muscular styling and V8 rumble then no amount of real or perceived ‘newness’ is going to sell me on something that offers me nothing.

    • 0 avatar
      Car Guy

      No, I should not be subsidizing someones’ 100K luxury item. A credit for a reasonable MSRP car is fine. Not for millionaires toys………….

  • avatar
    MoparRocker74

    Good riddance to bad rubbish. Tax credits for EVs/hybrids are just a feeble attempt to bribe us to buy wretched garbage by bribing us with our own money. Its obviously not working too good since theyre nothing but a fraction of the market, driven by image conscious rich do-gooders or cheapskates who think theyre getting something for nothing. The fact that not one of these POS’s has turned a profit should tell you something.

  • avatar
    hirostates12

    $7500 tax credits paid to rich knobs who can afford a fancy hipster toy as their third ride. Yeah, that makes sense.

  • avatar
    Whatnext

    Typical Trumpian administration chaos. Allow a report to be released clearly showing climate change is being caused by humans and at the same time phase out the EV tax credit. While I agree with those who suggest expensive models like Model S don’t really need credits. It’s to everyone’s interest to help middle income buyers get into an EV.

    Sad to see the knuckledraggers come out in force to comment. Of course whatever Der Trumpenfuhrer does with his fading empire on this is increasingly irrelevant. China has said its going full throttle on electric and that’s where the future lies.

  • avatar
    CombiCoupe99

    I, for one, am glad to no longer be supporting the EV subsidy. I can’t afford a Tesla – and I don’t care to help other purchase theirs!

  • avatar
    Ray Davies

    I don’t like subsidizing industry, but I don’t like China passing us on technology either!!


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