General Motors Asks Government to Change Rules on EV Tax Credits

Matt Posky
by Matt Posky
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general motors asks government to change rules on ev tax credits

General Motors is asking the federal government to reset the federal EV tax credit system, effectively requesting a personal favor. As one of the first manufacturers to get an electric vehicle to market that people actually wanted to buy, GM hit the 200,000 cumulative EV sales cap in 2018. While customers could still get money back through April of 2020, the automaker exhausted its allotment of $7,500 subsidies before most of its rivals.

Now it wants to see the government press the reset button on the program under a pretext of fairness. GM executives are claiming that companies investing in electrification shouldn’t be handicapped by not getting additional money from taxpayers. It seems anything but fair, frankly. Though it should be said that all-electric models have a poor track record in terms of profitability. The Chevrolet Bolt certainly didn’t make any money, however, GM CEO Mary Barra has said new versions of the model will be capable of turning a profit.

Ideally, the company would like to keep you thinking about the cheaper Bolt — and not six-figure Hummer EV and $60,000 Cadillac Lyriq that are coming out within the next 12 months — as you ponder this issue.

Automakers that have exhausted their sales quota (just GM and Tesla) have already received at least $1.5 billion in subsidies from the government under the program, plus whatever else they managed to eke out during the phase-out period. The whole point of the scheme was to soften the burden of manufacturers who were transitioning to EVs and incentivize consumers to become early adopters of the technology. But now GM is allegedly on the cusp of selling Cruises that actually make money and it wants to start the whole credit system over while it’s still in the lead.

“Incentives are an important consideration at the phase that we’re in,” Steve Carlisle, president of GM North America, said during the Automotive News‘ Congress Conversations virtual event.

“Given all the potential barriers to adoption and the fact that we need to get moving along that curve, I think incentives in many different forms enter into the conversation,” he continued. “A level playing field is a reasonable thing to aspire to.”

Automakers are always going to support handouts and try will always try to con elected officials into giving them preferential treatment. It’s just what multinational corporations do. But it’s getting to the point where it is expected that any businesses clever enough to engage in some greenwashing should get piles of money. We’re sympathetic to fines and know it’s becoming increasingly difficult to build automobiles that don’t conflict with the emissions regulations of at least one country and open a manufacturer up to penalties. Unfortunately, government handouts are becoming as ridiculous as the round-robin carbon credit system that effectively just makes it easier for companies with deeper pockets to pollute. It’s getting farcical across the board and the general populace really needs to wake up and smell the nonsense.

Though it isn’t just consumers that seem oblivious. Several automotive outlets reporting on the story came out to support General Motors, with at least one appearing to suggest that EV tax credits should be extended to all automakers indefinitely.

During a recent interview with CNBC, Chief Executive Barra said that her company shouldn’t be penalized (by getting the same amount of taxpayer money as every other manufacturer) just because it was quicker at exhausting the 200,000 vehicle quota. She acknowledged that $7,500 would undoubtedly influence customers buying future EVs, noting that GM would no longer be eligible under the old Obama-era credit system.

The company has asked the Biden administration to reset them, with Tesla likely in quiet agreement — as the decision would also be a boon for its bottom line.

While we cannot say whether the White House will go for the proposal, primarily because it would make it seem as though it’s playing favorites, it is definitely interested in accelerating EV adoption. Joe Biden has introduced a $174 billion proposal tied to the gigantic infrastructure plan that would allocate over half of the funding for customer rebates and expanding the United States’ charging network. The administration has also mentioned the reintroduction of Cash for Clunkers programs that would specifically target electric cars.

[Image: Michael Urmann/Shutterstock]

Matt Posky
Matt Posky

Consumer advocate tracking industry trends, regulation, and the bitter-sweet nature of modern automotive tech. Research focused and gut driven.

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  • Morea Morea on May 11, 2021

    It's UBI for the auto industry.

  • Ponchoman49 Ponchoman49 on May 12, 2021

    Turncoat Barra can go pound salt with her 20 plus billion take home profits pushing her triple zero fantasy and profits above all else. No more bailouts and no more subsidies for GM. If her amazing wonderful "everybody in" electric cars are so wonderful subsidies shouldn't be needed.

  • Marky S. I own the same C.C. XSE Hybrid AWD as in this article, but in Barcelona Red with the black roof. I love my car for its size, packaging, and the fact that it offers both AWD and Hybrid technology together. Visibility is impressive, as is its small turning circle. I consider the C.C. more of a "station wagon" by proportion, rather than an “SUV.” It is fun to drive, with zippy response and perky pick-up. It is a pleasant car to drive and ride in. It is not trying to be a “Butch Off-Roader”, or a cosseting “Luxury Cruiser.” Those are not its goals or purpose. The Corolla Cross XSE Hybrid AWD is a wonderful All-Purpose Car (O.K. – “SUV” if you must hear me say it!) with a combination of all the features it has at a reasonable price.
  • Ernesto Perez There's a line in the movie Armageddon where Bruce Willis says " is this the best idea NASA came up with?". Don't quote me. I'm asking is this the best idea NY came up with? What's next? Charging pedestrians to walk in certain parts of the city? Every year the price for everything gets more expensive and most of the services we pay for gets worse. Obviously more money is not the solution. What we need are better ideas, strategies and inventions. You want to charge drivers in the city - then put tolls on the free bridges like the Brooklyn, Manhattan and Williamsburg bridges. There's always a better way or product. It's just the idiots on top think they know best.
  • Carsofchaos The bike lanes aren't even close to carrying "more than the car lanes replaced". You clearly don't drive in Midtown Manhattan on a daily like I do.
  • Carsofchaos The problem with congestion, dear friends, is not the cars per se. I drive into the city daily and the problem is this:Your average street in the area used to be 4 lanes. Now it is a bus lane, a bike lane (now you're down to two lanes), then you have delivery trucks double parking, along with the Uber and Lyft drivers also double parking. So your 4 lane avenue is now a 1.5 lane avenue. Do you now see the problem? Congestion pricing will fix none of these things....what it WILL do is fund persion plans.
  • FreedMike Many F150s I encounter are autonomously driven...and by that I mean they're driving themselves because the dips**ts at the wheel are paying attention to everything else but the road.