GM Vehicles Would Be Eligible For EV Tax Credit On January 1st, 202351
GM reached the 200,000 vehicle cap to receive the full $7,500 federal electric vehicle tax credit way back in 2019, however the recently passed Inflation Reduction Act will do away with this ceiling, once again allowing the automaker’s vehicles to qualify for the incentive. That said, this change will not come into effect until January 1st, 2023, leaving GM vehicles on the sidelines as the new federal EV tax credits come into effect this month.
Under the government’s new EV tax credit plan, which became effective on August 16th, buyers of eligible vehicles can receive up to $7,500 off of a new EV manufactured in North America. The U.S. Department of Energy’s website currently lists 21 vehicles that are eligible for the full $7,500 tax credit, with models like the Chevy Bolt EV, Bolt EUV, Cadillac Lyriq and GMC Hummer EV excluded due to the 200,000 vehicle cap. Select GM vehicles will technically become eligible for the full tax credit once the cap is removed on January 1st, 2023, but there’s a catch.
According to the Alliance for Automotive Innovation, a lobbying group that represents major automakers including GM, VW and Ford, there are currently no EVs available that will qualify for the federal government’s $7,500 EV tax credit once the battery sourcing requirements come into effect on January 1st. These rules will split the $7,500 tax credit into two $3,750 parts, with half of this amount contingent on where the battery minerals are sourced from and the other half dependent on where the battery components are sourced from. So while GM vehicles would technically once again qualify for the $7,500 tax credit, it remains to be seen which vehicles will be entitled to incentives based on the battery sourcing mandates.
GM released a statement on the tax credits following the passage of the Inflation Reduction Act and acknowledged that some of the provisions in the bill related to sourcing requirements “are challenging and cannot be achieved overnight,” but said it remains committed to establishing a U.S.-based battery materials supply chain.
“We are confident that the significant investments we are making in manufacturing, infrastructure and supply chain along with the timely deployment of complementary policies can establish the U.S. as a global leader in electrification today, and into the future,” the automaker said in the statement.
Some of the provisions in the bill were necessary for it to be passed by Senator Joe Manchin, who expressed apprehension over “building a transportation mode on the backs of foreign supply chains.” This was a reference to the current EV battery supply chain, the majority of which is built on the backs of firms based in China, Korea and other parts of Asia.
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This is a JOKE right.. 😂🤣
No, also somewhere I saw there was caps on the price of the EV for it to be eligible for the incentives. Even if they fix the sourcing issue, they will be unable to keep the price down with inflation.
The one saving grace of the “inflation rocket” bill is I think most of it won’t get spent in the long run. There’s still Covid money available. I also doubt the IRS will be able to find 87000 new workers in this job environment.
Another stupid bill passed by dumb legislators that don’t have all the facts where our components come from and how long it would take for everything to come from the US. They are all inept and need to be replaced by term limits like our for-fathers envisioned. No more ten term senators or congress people.
C-6: I think you may have missed the point of the limits in this bill. My take is that (finally) they placed very strict limitations on what cars will qualify. I’m glad they did this and I have never thought it’s a good thing to use our tax payer money to assist others in buying import brand cars. This bill was written to push for more assembly and production within the US.
I still think back to the 2008/2009 time where they came out with the cash for clunker program. I was at the dealership with Buick, Cadillac, GMC and Honda. That program was majorly flawed in that it allowed many drivers of American brand older vehicles to get $4,500 towards the purchase/lease of Toyota’s, Honda’s, etc. This happened more so at our dealership because nearly none of the GM vehicles we sold would qualify, yet almost every Honda did. On top of that mess, I watched many very nice older vehicles get the stuff added to the engines to make them seize up before sending them off to the scrap yards. That killed me. Much to the displeasure of management, I refused to partake in anything with that program because I refused to sell Honda’s with the help of US tax money.
At least this bill is better at protecting the US auto industry.
I think the sourcing requirements are a good idea in principle, but they needed to be phased in. It kinda looks like Joe Manchin (who gets Republican levels of funding from fossil fuels) made a play at technically supporting the bill but really limiting this credit with a timetable that isn’t really realistic.
The Biden admin could probably ease that timeline somewhat in interpretation or enforcement. I could see on the high end of that spectrum of non-enforcement allowing manufacturers to state “we believe most of (x) models meet the IRS standard, but cannot guarantee your credit will be accepted.” There’s a lot of room within the question of which side gets the burden of proof.
I guess we’ll see in the next month or two what the details of the rules are and what manufacturers announce expecting to meet them.
biden is just trolling for mid term votes as a lot of this will never make it out of congress
“biden is just trolling for mid term votes as a lot of this will never make it out of congress”
Er…it already made it out of congress? This law was signed Friday. And it’s an earthquake in my industry.
Obviously the talk here is all on the EV portion, but really the BIG stuff is the fed credits and especially rebates that get administered at the state level on heat pumps and heat pump tech, advanced sealing and insulation, and electrical upgrades. Huge boost for us. (I’m in sustainable construction). Like I can’t even tell you how big. There isn’t going to be an electrician or HVAC contractor or poly-foam dude in this country worth their salt that isn’t going to have more business than they know what to do with.
And this stuff is an investment that keeps paying. It’s great legislation.
It is only a credit, which means the average working man cannot get the full $7500 even for a fully qualifying vehicle.
If your tax bill at the end of the year is $5000, that is all you get towards the vehicle. That’s $2,500 (far more) short for the average working person.
This bill helps the high income working class and Californians more than anyone else in the country.
Doesn’t help the ones that need it very much.
Vaporware – that’s not how taxes or tax credits work. Taxes are taken out of your paycheck every week or however often you’re paid. At the end of the year, you settle up with the govt and take into account any deductions and credits you are owed. If it was otherwise a $0 bill at the end of the year you would get a $7500 tax refund for a qualified electric vehicle. (assuming the tax credit is figured out then and not somehow included at the dealership)
I posted to you yesterday, but I included a link to the irs ‘s website. Maybe links aren’t allowed by the moderators.
Anyway, if you go to the irs wed page and search for form 8834, you will see the qualified electric vehicle credit is the smaller amount of the full $7500 or the tax owed minus all the other possible credits.
Then in the instructions it says the following:
If you cannot use part of the credit because of the tax
liability limit, the unused credit is lost. The unused or
excess credit cannot be carried back or forward to other
I do admit the advertising of the ev credit insinuates the way it should be, but in reality, it is a much narrower window than advertised.
yes, its a much better deal in 2024, in 2024 you can sign the 7500 over to the dealer and then he will take it off the price of the car
I’m wondering if this will be legit or dealers will somehow manage to game the system…
Our fore-fathers did not envision term limits. In fact, the Constitution specifically excludes term limits.
It would take a Constitutional Amendment to add term limits. Several of our fore-fathers (including John Quincy Adams – served until his death at age 81 ) served in Congress well past when we would want term limits to occur.
I don’t disagree with you about the ineptitude in Washington.
But talk of term limits is a non-starter given the magnitude of change necessary for a Constitutional Amendment.
You might benefit by reading the US Constitution and the Federalist papers. Our “for-fathers” (sic) were very much AGAINST term limits and didn’t want Senators or judges elected directly by the people. In fact, they didn’t even want the majority of the people voting, which is why they limited suffrage to landholding, non-slave men, a small minority of the population. They would see the term limits placed on many local offices and the presidency and shudder. They saw that kind of thing as mob rule, which leads to instability–what they wanted was stability.
with elections so close the libs are going for the green and union vote as every vote counts.
None of this really kicks in until next year. If any of the timing is election-curious, it’s how Coal Barron Manchin just couldn’t manage to make this deal without a full year of foot dragging.
While eligible, manufacturers inflate the price of their EVs by almost the amount of the incentive, thereby negating the benefit.
None of this matters when the company ( in this case, GM) can’t produce them in any numbers. I have yet to see one at my local dealer and have been watching for about 2 years!
GM isn’t going to mass produce a vehicle they are selling cheaper than it costs them to make. That’s not financially feasible.
The advertising and publicity boost obtained from the Bolt is worth the cost to GM. That way they can attract the attention of the customer to the models they mass produce that does make them a profit.
This is like a loss leader in the grocery stores. They are just there to get you in the store and (more than likely) the profitable items will be bought while you are there even though the loss leaders were sold out.
Battery sourcing is a tough one to meet. Obtaining raw materials I believe is limited in the USA. If there is mining and processing here in any state, EPA laws and toxic waste permits can take years if not impossible to obtain to protect any environment. It’s a very expensive and why it is less costly to import much of the battery material from countries with less restrictions. However, it can leave us dangling during a shortage, an embargo or a national emergency.
GeorgeS: Well said. This all makes me think of the old saying to be careful what you ask for as you may just get it. I’m referring to us (me very much included) wanting more to be built, produced, assembled and made only in the USA. Yet these raw materials, if not done properly, could really be bad for us to mine in the USA. This all must be done with the utmost care and with keeping it environmentally clean.
Where on the DoE website is the list of vehicles eligible for the tax credit under IRA? My search of the website turned up nothing relevant.
Wait till the evs need new batteries. That will cost a pretty penny. And what about insurance? That goes up mightily when you have an ev to insure.
That wasn’t the case for me. My 2020 Bolt was cheaper to insure than my 2016 Fiesta ST. YMMV of course.
Yeah, my insurance for my 2020 Bolt is about the same as my previous Cruze. I think the “replace the battery” point is weak. When an engine or transmission die, especially with what they make these days, people aren’t rushing into get them all replaced unless they have a legit reason to. Like my cousin’s F150 engine that set him back 10k….bout the same cost as a battery.
I’m lucky though, GM owes me a battery for my Bolt. Plan on taking my current battery to 100k miles then swapping it out to reset the warranty for another 100k…haha.
Both cars pieces of crap. Too small cheap cars.
Insurance goes up $200 annually for a bolt, at least with my insurance company. That’s some money but I don’t know that it would be a factor in my decision to buy.
Are you people all dinosaurs from another century… Are you working for the oil companies or do you just like spending $4 for a gallon of gas and polluting the environment… Get an EV and step into the 21st century… Insurance isn’t that much higher… With the tax credit you should be able to buy severa modelsl for under $30,000… Get a clue America
Still need gas power 3 row SUV to haul my family of 6 around and the boat. Don’t worry though, I did step into the 21st century and also own a Bolt….and bought it cheaper than a Camry new in 2020 with no tax incentives.
Hers is a little dyno talk from Forbes Magazine, hardly a conservative source. Tracing the source of these minerals, in what is called “full-cycle economics”, it becomes apparent that EVs create a trail of dirt from the mining and processing of minerals . To begin with, about half the lifetime carbon-dioxide emissions from an electric car come from the energy used to produce the car, especially. When a new EV appears in the show-room, it has already caused 30,000 pounds of carbon-dioxide emission. The equivalent amount for manufacturing a conventional car is 14,000 pounds. Even without reference to the source of electricity used for battery charging, if an EV is driven 50,000 miles over its lifetime, the huge initial emissions from its manufacture means the EV will actually have put more carbon-dioxide in the atmosphere than a similar-size gasoline-powered car driven the same number of miles. Even if the EV is driven for 90,000 miles and the battery is charged by cleaner natural-gas fueled power stations, it will cause just 24% less carbon-dioxide emission than a gasoline-powered car. As the skeptical environmentalist Bjorn Lomborg puts it, “This is a far cry from ‘zero emissions’”.
Best part of my Bolt’s window sticker “does not include emissions from generating electricity”
SEE HOW MANY MILES YOU GET TO DRIVE THAT IN THE WINTER. Don’t get stuck on the expressway sitting for hours Worst in the EV segment. AND where does your electricity come from? Coal fired plant, hydro or nuclear?
Totally agree with you. I didn’t buy one to be “green”. If my employer is going to pay to charge my car and it saves me $300 in gas a month and replaces a 9 year old car I’m in.
I’ve been in two winters in it I prob lose about 20-30 miles. Not a big deal since my employer pays for my charging. Also have sat on the highway and really no impact either.
With that, my Bolt is a commuter and run around. Fits the niche I need. I’ll rely on my Traverse for long distances.
You hit the nail on the head. More pollution to produce , not helping the environment. Great piece.
I think your investigation of your sources needs to go a bit beyond “It’s from Forbes, which is not conservative!” BTW Forbes is generally conservative, in fact you may remember a Republican candidate with that name, and his “fair tax” that would have further dropped the tax bills of Billionaires? You know, to be more “fair.” But we’ll forget that digression and pretend Forbes is a generally neutral venue.
“Dr. Tilak K. Doshi is a Senior Research Fellow at the King Abdullah Petroleum Studies and Research Center in Riyadh, Saudi Arabia.” “I have worked in the oil and gas sector as an economist in both private industry and in think tanks, in Asia, the Middle East and the US over the past 25 years. I focus on global energy developments from the perspective of Asian countries that remain large markets for oil, gas and coal.”
Dude, he’s 100% an industry shill. In this case it isn’t even lightly covered up.
I’m in sustainable construction, I’m quite familiar with lifecycle accounting. And the dude is absolutely taking every motivated liberty he can with the absolute outside marginal numbers, then putting a huge dollop of spin on top of that. Then pointedly failing to mention or account for the fact that the production of fossil fuel sources are themselves huge emitters, so each gallon of gas that gets to you has already engendered a variable amount of greenhouse gas emissions. And he knows this. He’ll be intimately familiar in fact, as a spokesman for gulf states’ oil, that his oil is the best in this department while Canadian tar sands is the worst and Bakkan shale oil is somewhere between. But he can’t get into that because he doesn’t want anyone thinking about how much destruction fossil fuel production creates before it even gets burnt.
Apart from that the “lifecycle” of “imagine that car even drives 50,000 miles!!!”
Seriously? EV’s have every reasonable expectation of outlasting ICE cars. He’s off by a factor of AT LEAST 4 and probably more like 7 or 8 in even just this part of the analysis. He knows this too. Don’t be so gullible.
Hmm did I forget the child labor for mining cobalt in the Congo? By the way if you read the article, you will note they put their sources so all can see and her sources include the UN.
To get an idea of the scale of mining for raw materials involved in replacing the world’s gasoline and diesel-fueled cars with EVs, we can take the example of the UK as provided by Michael Kelly, the Emeritus Prince Philip Professor of Technology at the University of Cambridge. According to Professor Kelly, if we replace all of the UK vehicle fleet with EVs, assuming they use the most resource-frugal next-generation batteries, we would need the following materials: about twice the annual global production of cobalt; three quarters of the world’s production lithium carbonate; nearly the entire world production of neodymium; and more than half the world’s production of copper in 2018. She also sourced the scale of mining for raw materials involved in replacing the world’s gasoline and diesel-fueled cars with EVs, we can take the example of the UK as provided by Michael Kelly, the Emeritus Prince Philip Professor of Technology at the University of Cambridge. According to Professor Kelly, if we replace all of the UK vehicle fleet with EVs, assuming they use the most resource-frugal next-generation batteries, we would need the following materials: about twice the annual global production of cobalt; three quarters of the world’s production lithium carbonate; nearly the entire world production of neodymium; and more than half the world’s production of copper in 2018.
And to top it off how about over 60 per cent of our electricity comes from… you guessed it, dinosaurs? How ironic to have that fueling your clean EV. But whatever makes you sleep at night works for me…
Tax credits don’t help low income people buy an EV since many low income people don’t pay anywhere near $7500 in federal taxes. EV’s are not going to do well with range in colder climates up north either.
Also, I don’t want to invest 30k-40k or more in a vehicle that you can’t take on a long trip across the country without it turning into a big long forever project taking 3 times as long as it should !
Hybrids are the way to go with no range anxiety. When I take a trip I want to get there as quickly as possible.
Maybe some of the 87000 new IRS agents can afford an EV !
Biden should have given every state money to hire 87000 new police officers instead to help curb the high crime rates in Chicago, New York and all across the country.
There’s a transferable credit on used EV’s of 4,000.
I’ll agree that at this time the best deployment of the limited battery capacity into the U.S. fleet is probably plug-in hybrid. The same battery capacity spread into 4 PHEV’s instead of 1 EV is going to be a much greater emissions reduction.
And obviously most Americans aren’t willing to change their habits, expectations, or pace of life yet, so yeah, I think EV’s aren’t really ready for super widespread adoption over maybe 30% or so?
The best part about this is the fact the cavemen, er, CONservatives are going NUTZ over the Liberals trying to CONSERVE our planet. Vote every ReTHUGlican out of office before we are a Fascist nation.
If you get an EV, drive the wheels off it to overcome the upfront CO2 from production. Driving an EV for only occasional local running around is worse than gasoline.
Well guess what , if you don’t owe 7500 in taxes, you don’t get the 7500, if you owe 1000, that’s all you get, and there is no carry over, it’s a one time thing
I don’t like this new bill because it’s unfair to not give someone a break to buy an EV depending on where the batteries are produced… I guess Walmart should charge us extra because most of their crap is made in China… Yet people flock to Walmart and don’t care besides do you want a mine in your backyard! The worry of American jobs should have been addressed twenty years ago
I thought there was an income limit of 150,000$ to get 7,500 back In California and a family with one kid making 150k is barely making it in Bay Area. I know people in Midwest think this is a lot but cost of living here is high. Why do they have income limits
“I thought there was an income limit of 150,000$ to get 7,500 back In California and a family with one kid making 150k is barely making it in Bay Area.”
The single head of household is 225k, for joint-filers it’s 300k
these are proposals from the feds and are not laws yet because biden can not just wish these rebates as they have to go thru congress. this is all a ploy to get votes in the primaries from the greens.