By on April 10, 2019

With many concerned that the public’s modest adoption of electric vehicles could backslide without a federal tax incentive, U.S. lawmakers introduced legislation on Wednesday to expand the EV tax credit by 400,000 vehicles per manufacturer.

This would help companies that have already exhausted their quota, like Tesla and General Motors, but even automakers that are nowhere near their current allowance would have something to gain — a wider window in which to sell alternative-energy vehicles with governmental help.

Called the “Driving America Forward Act,” the legislation would grant automakers a $7,000 tax credit for an additional 400,000 vehicles and shorten the depletion/phase-out schedule to nine months. However, the existing deal of 200,000 vehicles per automaker eligible for $7,500 tax credit would also remain intact, resulting in a pretty big allowance for government incentives. 

Sponsored by Senators Debbie Stabenow (D-MI), Gary Peters (D-MI), Lamar Alexander (R-TN) and Susan Collins (R-ME), the bill is one of those rare instances of bipartisan legislation. Reuters reports that the plan has already received widespread support from automakers and environmental groups. Still, there are those who believe the incentives are doing more harm than good — artificially propping up a section of the industry that cannot yet stand on its own.

The White House has already suggested eliminating the current EV tax credit system, saving the federal government a claimed $2 billion. Meanwhile, Senator John Barrasso, a Republican sitting at the head of the Environment and Public Works Committee, proposed legislation to end the credit and impose a highway user fee on EVs to help pay for road repairs last February.

Estimates place the cost of “Driving America Forward” at a whopping $11.4 billion.

From Reuters:

GM and Tesla shares rose on Reuters report that the bill would be introduced. Tesla shares recently traded up nearly 1 percent, while GM was up 0.2 percent.

Supporters hope to attach the proposal to tax legislation that could be considered in the next few months.

The existing $7,500 EV tax credit, which allows taxpayers to deduct part of the cost of buying an electric car, phases out over 15 months once an automaker hits 200,000 cumulative EV sales. GM saw its tax credit cut to $3,750 on April 1. Tesla’s tax credit fell to $3,750 on Jan. 1 and will end entirely at year’s end.

Both GM and Tesla have been lobbying Congress for more than a year to extend or evolve the EV tax credit system. The bill received support from both — in addition to Toyota Motor Corp, Ford Motor Co, BMW Group, Volkswagen Group, Fiat Chrysler Automobiles, Honda Motor Co, Nissan Motor Co, and various utilities.

“We have a cap that’s got to go up,” Stabenow told automakers last week. “I want to get this done as soon as possible.”

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56 Comments on “Bipartisan Bill Hopes to Triple Number of EV Tax Credits...”


  • avatar
    stingray65

    Imagine that, “temporary” EV subsidies become permanent welfare for wealthy EV buyers.

    No government ever voluntarily reduces itself in size. Government programs, once launched, never disappear. Actually, a government bureau is the nearest thing to eternal life we’ll ever see on this earth! Ronald Reagan.

    • 0 avatar
      stuki

      And, more importunately, welfare for even wealthier holders of Tesla and Fairytale Motors “assets!”

      Nothing like life in a progressive dystopia! At least as long as you are on of those designated “more equal,” or their well indoctrinated lapdogs.

    • 0 avatar
      kamiller42

      Posts like this make me wish there was a Like button.

      GM & Tesla… Not surprised two companies whose survival is owed to government money are the biggest lobbyists.

      Senator John Barrasso’s idea of an EV road user fee is great. Road maintenance is paid for with gas taxes, which EV owners are avoiding.

  • avatar
    ToddAtlasF1

    The Republicans need primary opponents.

    • 0 avatar
      Robotdawn

      Amen, seems like they have forgotten one of the 4 primary groups of reliable Republican voters, Fiscal Conservatives.
      We were better off with a split government that never approved anything, and thus at least kept spending somewhat restrained.

    • 0 avatar
      kosmo

      Yup. Susan Collins is a Republican kind of like a Yugo is an automobile. Not really.

  • avatar

    Electric vehicles will be a mainstream choice for many consumers when: 1) the minimum range under very hot or cold conditions is 250 miles, 2) recharging stations are along almost every highway, 3) recharging takes a maximum of 15 minutes, and 4) the overall costs of purchase, fuel, & service are about the same as for a conventional car – WITHOUT government subsidies that rob people whose needs make EVs an impossible choice. I strongly object to having my federal tax dollars robbed to subsidize mostly well off car buyers who find EVs meet their needs – because they DO NOT meet my needs.

  • avatar
    tomLU86

    Stingray and JCW have basically said all that needs to be said.

    How disappointing that TTAC didn’t dig a little deeper and name the lobbying groups that “got to” these Senators. Now we have the façade of bipartisanship on a bill that will basically tax the many for the WHIMS (minimal benefit) of the few, and help the campaign funds of these groveling ____ senators.

    Elsewhere on this esteemed website (I enjoy it), we read that Gotham is enacting fees for cars to reduce congestion. Apparently everyone is ubering it. How does that square with the ‘vision’ for electric vehicles is to trap people in wheeled tablets, where their tastes and clicks can be monetized, IN ADDITION to the costs they will bear to ride on electric AVs? THey promise no congestion, ha!

    I like cars, but we have too much congestion, and dare I say here, too much waste in this country. The roads are crumbling. I prefer an honest $2 to $5 gallon federal gas tax, with the proceeds used to fix our roads properly. In the unlikely event this tax raises more money than needed for roads and bridges, we can then modernize our airports and other INFRASTRUCTURE.

    Raising the price of fuel would separate those who really need truck and SUVs from the many who like, but don’t need these gas hogs. Pricier fuel does will reduce congestion, and emissions at much lower cost than the happy fantasy of EVs, which will enrich a few while costing the vast majority of the public their money and freedom.

    • 0 avatar
      jack4x

      I don’t necessarily disagree with you, but a $2-$5 gas tax is much much more regressive than subsidies for wealthy EV buyers.

    • 0 avatar
      SCE to AUX

      That ‘honest’ $2 to $5 Federal gas tax will have little impact on driving habits.

      Rising CAFE requirements are are direct odds with raising revenue from gas taxes.

      If you want EV drivers to pair their ‘fair share’ (whatever that is), then you could calculate road tax as follows:
      Tax = GVWR x miles driven

    • 0 avatar
      MoparRocker74

      These fatass beauracrats and politicians are already bleeding us dry. MORE than enough money is allocated to infrastructure and they aren’t using it in the way they’re supposed to. So your solution is to further cripple everyone economically and HOPE that some of this money is invested properly instead of redirected to pet pork barrel projects or outright stolen? Are you KIDDING me?

    • 0 avatar
      ajla

      I would not support your plan.

  • avatar
    stuki

    I guess the admen figured renaming the “Robbing the Productive for the Benefit of the Connected act of 1871, amendment #23,457,387,976,223,232,” into something snappier for well indoctrinated dupes to be suckered by; would improve its chances of not being recognized for the undifferentiated, rapacious theft that is all that it really is…..

  • avatar
    smartascii

    If we’re going to spend whatever $4,000 x 400,000 units x OEMs who make BEVs comes out to, and if we’re going to do it with public funds, wouldn’t we do better to invest that in some sort of DARPA-style research initiative to figure out how to make transportation cheaper and more sustainable?

  • avatar
    Freddie

    Enormous direct and indirect subsidies have placed a relative handful of expensive, semi-practical EVs on the road. I wonder if a bigger carbon reduction bang for the buck would be achieved by providing incentives for hybrids.
    Remember the saying that the “best is the enemy of the good”. Hybrids have very low emissions while offering a reasonable price and no major sacrifices compared to a conventional ICE vehicle.

    • 0 avatar
      28-Cars-Later

      So refreshing to see critical thinking.

    • 0 avatar
      SCE to AUX

      Hybrid subsidies expired long ago. Many Prius owners benefited.

    • 0 avatar
      dwford

      With cars like the Honda Insight starting at virtually the same price as the equivalent Civic, there is no price penalty to overcome with government incentives anymore.

    • 0 avatar
      dtremit

      Incentives for hybrids make sense if you only consider the car itself. But a discount on a hybrid only reduces the emissions from one car.

      Incentives for BEVs have a lot more downstream benefits. The more BEVs you have on the road, the more demand there is for charging infrastructure, which in turn drives more demand for BEVs.

      That charging infrastructure can be used for plug-in hybrids, which are supremely practical for a lot of use cases — and will be there to charge the much less compromised, much less expensive BEVs we’ll have ten years from now. Those won’t need any subsidies to look attractive.

  • avatar
    SCE to AUX

    Here’s the conundrum:

    If you eliminate the subsidy now, then you’ve (effectively) helped *only* Tesla, GM, and Nissan.

    If you extend the subsidy, then you continue propping them all up, and the volume maker (Tesla) more than anyone.

    What I’d prefer to see is a “Manhattan Project” to achieve US energy independence.

  • avatar
    28-Cars-Later

    Reeks of desperation.

    “artificially propping up a section of the industry that cannot yet stand on its own.”

    Oh its only been nearly nine years since Volt, why not nine more? Its only money!

  • avatar
    MoparRocker74

    This is completely INSANE. By continuously offering up bribes to buy EVs, that’s just freely admitting that they’re substandard turds and no one actually WANTS them. I don’t see any of this for Hellcats, Lamborghinis, Power Wagons, etc. Gee whiz…wonder why?

    If some guy is willing to pay a substantial cash reward for someone to marry his daughter, would you expect that she’s a stunning beauty with wit, charm, personality and is an all around catch? Anything good and desirable moves itself. It doesn’t need incentives, penalties or any other flim flam trickery to get people to demand it.

    • 0 avatar
      Matt Posky

      Funny analogy. But I wish you had said “G-Wiz…wonder why.”

    • 0 avatar
      SCE to AUX

      Q: Since the subsidy is the same for all BEVs, why do you think the vast majority of EV buyers purchase Teslas instead of the other EVs available to them, particularly when the subsidy means the least for that brand and that buyer?

      A: Because Tesla produces the best EVs – people actually do want them.

      • 0 avatar
        Art Vandelay

        “Because Tesla produces the best EVs – people actually do want them.”

        Then why the need for the subsidy? Why should one freaking red cent of the massive amount I paid in taxes this year (several full ev subsidy’s worth) go to someone else to buy a car that Costa more than any vehicle in my driveway especially when I purchased a used electric this year and got nothing. You want one? Fine, buy one but you leeches keep your hands out of my freaking pocket for a change.

      • 0 avatar
        285exp

        Sure they want Teslas, just not at a price at which Tesla can make money.

    • 0 avatar
      HotPotato

      You don’t see it for Hellcats and Power Wagons because they don’t offer any public benefit. You see it for EVs because they reduce urban pollution (toxic gases and noise alike), reduce foreign oil dependence (and the associated need for deadly military entanglements), and most of all reduce greenhouse gas emissions (which apparently endanger life on Earth, period).

      This is not hard to understand.

  • avatar
    jacob_coulter

    How about we trade this for getting rid of CAFE?

    These types of programs are just welfare for the rich, I’d love to see the average net worth of someone that buys an electric car.

    And how exactly does society benefit? Should we also give subsidies like this for people who drive sedans instead of SUVs?

    • 0 avatar
      SCE to AUX

      The original idea for the subsidy was to replace an ICE car with an EV. The air doesn’t care about the income of the person driving, and ‘rich’ people are much more likely to buy new cars than poor people.

      All tax breaks benefit ‘rich’ people more than poor people, because poor people pay almost no taxes. Most government tax revenue comes from ‘rich’ people.

      • 0 avatar
        Art Vandelay

        “All tax breaks benefit ‘rich’ people more than poor people, because poor people pay almost no taxes. Most government tax revenue comes from ‘rich’ people.”

        Yet everyone howled and complained that the last tax break was a handout to the rich. All I hear from the EV fans is how great they are. Maybe they are. So buy them and stop asking me to chip in for them.

      • 0 avatar
        28-Cars-Later

        “because poor people pay almost no taxes”

        This really isn’t accurate. State/local income, FICA, utilities tax, fuel tax, cigarette tax, alcohol tax etc.

      • 0 avatar
        jacob_coulter

        Less taxes are not the same thing as a handout.

    • 0 avatar
      MoparRocker74

      How about a 100% free market with only the absolute barest skin of the tooth minimum of basic regulation to ensure that blatant death traps aren’t being hawked onto the road? No stacking of the deck for anything.

      Otherwise, Ill take the other side: Tax credits are only for those who up grade to the largest V8s. Instead of gas guzzler taxes for powerful vehicles, sock the slow wheezy misery boxes with a $2000 tax for slowing down traffic.

  • avatar
    Jerome10

    nononononononononononononononononononononononono

    The number of completely moronic, uneconomic growth that falls out of DC just keeps growing.

    EVs don’t work because they don’t work. Why are we trying an inferior “solution” onto the public?!

    Oh, that’s right, we are just swimming in surplus money these days. Nobody pays insane income taxes, or property taxes, or sales taxes, or social security taxes, or a half a years salary to have “health insurance” that is no such thing, and nobody has to try to educate their kids in a public education system that keeps sucking more and more money while doing nothing to better education, and then when that’s done, open up for $100,000 grand for college!

    But hey, this is a worthwhile expense, right?

    Kill me.

  • avatar
    ToolGuy

    I can’t get too excited about this one way or the other *because*:
    – Your US Federal government spends over $2 billion an hour
    – So eliminating the current system would save an hour’s spending for whatever else we’re already getting
    – Even if the proposed program passes at the $11 billion level (Hint: it probably won’t), 99.7% of my taxes won’t be going to this program
    – Edmunds calculated that Cash for Clunkers cost $24,000 per incremental sale – so $7,000 per vehicle for this would be only 29% as stupid

    Every little bit counts, yada yada, but if you are serious about reigning in stupid spending, there are bigger and more productive targets at which to vent your wrath.

    (Meanwhile, oil companies get billions of dollars in taxpayer subsidies year after year. But we love them and they never abuse our trust, right?)

    • 0 avatar
      gasser

      IDK how “cash for clunkers” got to $24K/car. I would like to see those calculations.
      I thought that was a great idea. Get old polluting vehicles and gas hogs off the roads. Plus a LOT of the subsidy goes to middle class, not wealthy, buyers. I would rather see a new “cash for clunker” program than a doubling of the BEV subsidy. BEV subsidies leave out an awful lot of car owners, who rent apartments or who live in big cities with NO dedicated parking, out in the cold. The poor pay little or no tax; the wealthy have much left after tax; let’s give some benefits to the middle class now.

  • avatar
    Art Vandelay

    I swear to God if this happens I am going to replace my F150 with one of those new 7.3 Super Duty’s when they come out. I can swing it and frankly I am sick of paying a metric a$$ton of taxes only to have a bunch of societal leeches hate me for my car/politics/whatever and I know the true believers would cringe at that truck. Heck I may lift it.

    Even better I’m going to build that third Gen Camaro with a 6.2 instead of the sensible 5.3 and blow Marlboro Red smoke at every Tesla I see while the blasting Van Halen shakes apart the Tesla which is incidentally only marginally better assembled than said B!+c#!n Camaro anyway.

    I can afford a Tesla…Heck I could buy an X. I don’t want one. Why should I have to help pay for yours? All I’ve heard was how big a waste the wall would be. Then you freaking leeches shove your hand in my pocket to take more for your nonsense.

    Is it too much to ask that you at least give me a hand job if you insist on shoving your hand in my pocket all the time?

    • 0 avatar
      SCE to AUX

      Chill, Art; you’re going off the rails.

      Go ahead and buy the Super Duty. It costs as much as a Tesla to purchase, and the gas taxes you’ll pay driving that thing will far exceed your portion of the EV subsidy.

      Go ahead and buy the Camaro, too. But I’ll warn you – the smoke you want to blow will be on the car behind you, and that won’t be a Tesla.

      Lastly, for consistency, please direct some of your vitriol to drivers of Nissan Leafs and Chevy Volts. They’ve received the same EV subsidy.

      • 0 avatar
        Art Vandelay

        Yet there is a Leaf in my driveway on which I got no subsidy due to it being used (It was a cheap car that met my kids need for basic transportation not far from home).

        The car met my need and I paid a fair price for it. No third Party involved taking someone else’s money to help me with the purchase.

        And I most definitely have the money to make that Camaro beat a Tesla. It would be zero fun on the street, maybe kill you in the rain and look like I drove it off the set of Street Outlaws but I could get it to go A to B more rapidly than said Tesla.

        And my vitriol is directed at anyone that gets some of my money to purchase a car. The primary reason for the Tesla vitriol is that as an owner base, they seem to be the most “Smug”. Additionally they non stop tell me how great the car is and is better in every way than an ICE car while simultaneously supporting the subsidy that they have been proclaiming they don’t need because they are so good. It is interesting that their sales seem to be slowing just as that subsidy ended.

        And I have no issue affording the freaking gas for whatever I choose to drive…just as the model S or X driver has no issue with the MSRP. The difference is I don’t ask anyone else to help me pay for it.

        • 0 avatar
          Art Vandelay

          You know what my state could do to help out with CO2 emissions and dirty? Eliminate our coal plants. We make enough energy to meet our in state consumption without them. The problem is that the “clean” states out west don’t. Therefore we export a bunch of electricity. Perhaps the Washington’s and Oregon’s need to step up to the plate…It isn’t really clean energy if your in state production is clean but you just export the dirty stuff to the flyover states.

        • 0 avatar
          HotPotato

          Just because you bought your Leaf used doesn’t mean you didn’t benefit from the subsidy — your benefit was indirect, that’s all. If not for that subsidy, chances are pretty damn slim the original buyer could have afforded to purchase it, and it never would have come onto the used market for you.

          P.S. If you’ve got enough money to buy all the stuff you claim you can buy, I don’t know why you’re complaining; you’ve got it better than most.

    • 0 avatar
      SCE to AUX

      By the way, EV drivers didn’t vote the EV subsidy into being – your legislators did.

      • 0 avatar
        Art Vandelay

        Not so fast my friend…both of my Senators at the time were “Nay” votes (Shelby, Sessions) and while my Representative did, he was a Democrat in what is now a very red district. Richard Shelby is still in office so I am inclined to think he wouldn’t shift his view. Doug Jones would likely support it, but he is a political endangered species in Alabama who only won because the Republicans managed to nominate what was likely the worst candidate on the national stage that cycle and even with the baggage of Roy Moore only managed to eke out a win. He is done in 2020 (He doesn’t get the full 6 years…he was filling Jeff Sessions remaining term). Given Alabama politics it is unlikely his successor will support it. I will not be voting for Senator Jones. My current representative is a tough one (Mo Brooks). I am inclined to think he is a “Nay” on this, but Alabama 5 includes Huntsville, which while fairly solidly Republican does have a ton of tech (and a new Toyota plant being built) so maybe, but given his politics, I doubt it.

      • 0 avatar
        Art Vandelay

        Both of my Senators back then were “Nays” on the original credit (Sessions, Shelby). My representative was for it, but the district is solidly red now so a repeat seems unlikely. Doug Jones would likely support it, but he is done here anyway.

        Here is my beef with Tesla drivers summed up. Upon Alabama’s government deciding to raise the gas tax and impose a registration fee on electric vehicles (200 for full ev, 100 for hybrids), a Tesla owner had the following to say:

        “It is somewhat offensive to me for a government agency to tell me that I owe money on a gas tax because my entire belief structure is not to participate in a gas economy,” said Daniel Whitt, a Tesla owner.”

        So if paying for roads is part of the “gas economy”, I’d invite him to bolt some super swampers to his Tesla and get in touch with his “True Alabamian” and avoid using the roads in his commutes. additionally as a participant in the gas economy, isn’t his taking my money for the credit on his Tesla sort of like blood money?

        • 0 avatar
          Art Vandelay

          also like 25 percent of the EV fee is for charging infrastructure which also is funded via, you guessed it, the gas tax.

          • 0 avatar
            ToolGuy

            Art,

            Alabama exports electricity because of TVA (nuclear, hydro). Are you ok with TVA?

          • 0 avatar
            Art Vandelay

            Of course i’m good with the TVA…I like electricity. We export around 1/3 of the energy produced in the state.

          • 0 avatar
            ToolGuy

            OK, but when TVA was formed they put hands in a lot of pockets, and much more.

            Growing up, the dad next door – his job was to drive out and tell people their house would be underwater soon. Not metaphorically worth less – but physically covered by liquid water.

          • 0 avatar
            Art Vandelay

            I grew up in Georgia and we had the same thing with the Dams there (depicted in “Deliverance” funny enough). At least in those cases Imminent Domain was used properly, like the law or not, to build public infrastructure as opposed to taking those houses and giving them to WalMart to “increase the tax base”

  • avatar
    SuperCarEnthusiast

    Only the rich can afford EVs! Remember the additional $2K to install the needed 240v outlet in ones garage to charge the EV. You do not want to buy used EV either since cost of repairs is very high, electric motors, drivetrains, battery bank etc…

  • avatar
    tomLU86

    Mopar Rocker and others,

    I share your sentiments to a large extent. It’s possible, or probable, that the fuel taxes we pay don’t all go to roads.

    But then, where does that money go to? It’s going some where—and it ain’t enough brother! We have a $1 trillion deficit… And that’s the tip of the iceberg.

    College debt…

    I look at our roads….crumbling faster than they are being rebuilt in my state.

    Basically, IN GENERAL (this is not the same as EVERYONE), we are living beyond our means. I’m not sure how much longer this can go on…after all, we’ve been living beyond our means my entire life (certainly adult life), and the sky has not fallen. Maybe I’m wrong.

    Yes, my gas tax is regressive. And when the working poor all go to trade their 15-yr old F-150s for Civic, the price of F-150s will crash.

    My gas tax won’t happen.

    But our debt problems and roads won’t fix themselves.

    And, in my opinion, people driving full size trucks and large vehicles to commute, or buy groceries, with just the driver is a waste… a waste of fuel and emissions, and one day we will regret it.

    Going fast, on the other hand, is OK by me, because it saves time. One can do the fuel vs time calculation and go with what works for them.

    Just one opinion here in the commentariat sea….

  • avatar
    Carlson Fan

    This is good news. Hopefully it will help flood the market in a few years with used lease return EV’s worth little to nothing. I’ll take something from Cadillac!……LOL

  • avatar
    HotPotato

    If you put your head up your arse, don’t be complaining about the smell.

    Being pro-EV isn’t the environmentalist position anymore. The consensus on climate science has formed* and it’s a given at this point that the transition to EVs needs to happen. Being pro-EV is now seen as being pro-car, and the environmentalist position now is anti-car.

    In other words, if you like cars, get your head out of your arse and stop attacking EVs. Because the alternative isn’t Hellcats forever. It’s a bus pass.

    • 0 avatar
      HotPotato

      *I’m aware that your favorite red-faced YouTube/talk-radio/cable-TV shouter doesn’t agree with the scientific consensus on climate change, a spherical earth, the effect of vaccines, and so on. Fools will always be with us.


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