GM Expected To Reach Electric-Car Tax Credit Cap In Q1 201915
Earlier this summer, Tesla became the first major automaker to reach the cap for the United States government’s electric-car tax credit. The credits are good until an automaker sells 200,000 qualifying electric cars and plug-in hybrids. General Motors is likely on deck to be the second automaker.
GM has sold 186,670 qualifying vehicles, the Detroit News reported Monday. The tally includes the Chevrolet Volt, Spark EV, Cadillac CT6 Plug-In and the Bolt EV. Each car has been eligible for a $7,500 tax credit. GM itself predicted it will reach the cap by the end of this year, but Edmunds believes it won’t happen until the first quarter of 2019.
Once an automaker reaches the cap, the $7,500 credit enters a sunset period and halves itself every six months until the figure reaches $0. Thus far, there are no plans to extend the credits, though a bill was introduced in Congress earlier this year. The credits were originally designed to increase electric-car sales at the turn of this decade, but it’s only recently that automakers have begun offering plug-in and electric cars with ranges more suitable to drivers’ needs.
It’s unclear what the loss of the tax credit will mean for GM’s zero-emission future pledge. In the near-term, the tax credit will mean Chevrolet’s electric cars will cost more, which could hurt sales. Analysts believe Tesla is in a better position to absorb the tax-credit loss since the cars are priced higher compared to Chevrolets.
GM plans to introduce 20 electric cars by 2023 and the first two were originally expected by 2020. However, reports surfaced that one of the cars for North America, a Bolt EV-based Buick electric car, may be on hiatus as GM deals with the loss of the tax credit.
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Congress can help the domestic EV manufacturers by removing the tax credit for all the foreign brands (BMW, Hyundai, Kia, Mercedes-Benz, Nissan, Toyota, and VW) now. The profits of those EV vsales are leaving the U.S. so they are not helping us.
No car selling for more than $60 k should be eligible . Most tesla buyers. Buying a performance model will buy anyway
I’d like GM to be transparent with their plans. I really don’t need a new Volt/Bolt, but if this rebate is going to fade away and GM will not drop the MSRP in lock-step to keep the net price identical, then I could probably pull the trigger. I believe I’d have until 6/30/19 if they cross the threshold in Q1.
GM isn’t going to drop the MSRP by $7500, not everyone qualified for the full amount and some not at all anyways…
You’d have until 9/30/19 if they reached it in Q1. They get to finish that quarter and then the sunsetting begins as follows. Two quarters at $7,500, two at $3,750, two at $1,875 and then nothing.
I think you’re correct about the $3750 and $1875 levels, but according to the following report and others I have read, the full value only remains to the conclusion of the current quarter, plus one additional quarter.
At just over 300k global sale total, I wouldn’t call tesla a major automaker. How many dollars lost per car does that work out to?
Time for more PR mr. musk.
Considering they reportedly started offering a commission on the performance version of the model 3 and the fact you can’t buy a $35K one yet, they’re probably not losing money…
“offering a commission on the performance version of the model 3”, that’ll increase sales.
Good for PR, no?
Last I heard, they would burn through all there cash by the 4th quarter unless the model 3 hit +20k sales per month. even then, would demand remain as more and more “major automakers” release EV’s?
Impossible to determine how they will burn through their cash, they just made $1500 surf boards and are aquiring reservations for the roadster 2.0 and semis…Demand will be challenged yet a lot of people want their Model Y SUV…
I just call them as I see them.
“fastest growth of any automotive company in the modern era” = PR
If I sold one apple yesterday and two today, I have doubled in size! = PR
A tax credit should not be given to buy any car period!!! Especially if those cars are of foreign makers regardless of where those cars are built!
If this is the case then why dont we get tax credit for a Corvette?
Exactly theres no reason for a tax credit!
All expensive cars should qualify. We need to help save the wealthy money so that they can create jobs for us.
GM used to roll the rebate into leased PEVs and suddenly they don’t do that anymore? If I decide to buy the car I may not qualify for the full credit? I guess the only point of the tax credit is to tease people into going to the dealership. The dealership I was at put about half of the credit into my lease – but I’m holding out for all of it. We’ll see.
In no way is the current rebate system fair. Leave it to politicians to take a good idea and manipulate it to death. Of course I don’t see anything changing until the new congress next year, but time to start bouncing some GOOD ideas. Maybe start by moving the oil industry subsidies over toward electrification.