GM now says it produced approximately 20,000 EVs which are not eligible for the $7,500 U.S. electric vehicle tax credit before modifying its supply chain to meet revised governmental requirements that took effect in January 2024.
The automaker’s CFO Paul Jacobson provided additional details during the mid-March SAFE Summit 2024: Solving the Global Power Puzzle held in Washington DC, according to a report by Reuters.
Most GM electric vehicle models – and the majority of those produced by other automakers as well – became ineligible for either a full or partial EV tax credit when the U.S. Treasury rolled out new rules for battery sourcing on January 1st, 2024. The General had built approximately 20,000 ineligible EVs up until its supply chain revisions trickled down to the assembly lines.
This figure appears to be revised downward from earlier GM statements in which The General said around 25,000 Chevy Blazer EV and Cadillac Lyriq crossovers were ineligible for the tax credit. To compensate for the lost tax credits on these vehicles, the automaker offers a $7,500 rebate on affected vehicles.
GM reshuffled its supply chain to source several more battery components from trusted suppliers instead of from countries deemed to be geopolitical rivals of America. The 2024 Cadillac Lyriq was the first model to regain its qualification for the tax credit, becoming eligible again in February.
The 2024 Chevy Blazer EV soon had its EV tax credit eligibility restored too, regaining its status early in March. At the same time, The General lifted a stop-sale order that had been in place for approximately two months. The stop-sale was related to software glitches for which the Bow Tie brand’s engineers had to develop a remedy.
Sales of the 2024 Chevy Blazer EV resumed with a lowered starting MSRP under $50,000 for the base trim, along with several new features.
As a reminder, both the Chevy Blazer EV and Cadillac Lyriq crossovers are underpinned by the BEV3 platform and use Ultium batteries and Ultium Drive motors for motivation.
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Comments
oh the horror, you have to buy a vehicle without tax player funded incentives.
Technically you’re just paying less taxes. You can’t get a refund larger than the taxes you owe. If you only owe $2000 in taxes you can’t claim more than $2000 for the refund.
Yep, EV tax credit is non-refundable, limited to tax owed. AGI must be less than 75K single, 150K married. In many ways, the gm ultium cash was better than the tax credit, particularly for high earners.
Your income limits seemed way too low, so I looked it up. Actual income limits are: $150,000 (single), $225,000 (head of household), or $300,000 (married filing jointly). I think these limits are reasonable.
Why are we giving tax credits to a family having an AGI of $300K to buy a certain type of vehicle?
Great question.
I am so happy as a retiree that I can help somebody earning $150K – $300K buy his or her new $80K Tesla.
You’re not helping anyone. They just owe less taxes. This is not a tax credit. It just reduces your liability.
That limit is for used EVs. New one are:
For new clean vehicles:
• Married filing jointly or filing as a
qualifying widow(er) – $300,000
• Head of household – $225,000
• All other taxpayers – $150,000.
This is per https://www.irs.gov/pub/irs-pdf/p5900.pdf
You had me worried for a while. Then I checked the IRS web site.
Most dealers can apply tax credit at point of purchase. Just be sure your income is not to high or you will owe the IRS. No worries of “owing” enough tax to offset the full $7500.
I hope you don’t mean the taxes you still owe when you file your taxes. It comes off your total tax liability.
It’s your total tax liability.
SIMPLE, because many automaters had to scramble like hell to find suppliers to replace parts that did not satisfy the government date January first, just push the date back two months. It look like two months will be enough push back to allow automakers to replace unacceptable suppliers with acceptable ones. (common sense)
It’s a lot more complicated than that. GM was already building cells in the US at its Ultium plants. They just had a couple of components that didn’t meet the criteria. Outside of Tesla with its Panasonic 2170 and 4680 cells, no automaker has an easy/quick path for packs built in the US. Ford’s plant isn’t complete yet.
Not sure why, but the standard range RWD model 3 is not eligible for the full credit. And yes, apologies, I’d picked the used car limit for income above.
Panasonic isn’t the only supplier of batteries for Tesla
The rest aren’t made in the US, so they don’t qualify for the tax credit.
Blazer EV made in Mexico but because of NAFTA they qualify. That is why the govt is afraid of China opening a factory in Mexico.
To qualify the vehicle and critical components need to be made in NA as well. The biggest being the battery.
ANOTHER POLITICAL BLUNDER NOT IN MY GARAGE
Wasn’t GM covering these cars with a $7,500 rebate anyways?
Yes, there’s a link to that story at the end of the fourth paragraph if you want more details.
Wait until the battery recycling / disposal costs are determined to be another revenue stream to charge “environmental mark-ups”.
EV batteries are highly recyclable. Unless destroyed, they can be used for energy storage since they still have capacity left, but below the 70% they are warranted. After they reach their usable lifespan, the chemicals are separated and made into new batteries.
Look up the company li-cycle and see what they do. They are currently processing GM’s scrap Ultium materials. They claim 95% of the materials in the battery can be recycled. Also, don’t forget all the phone and laptop batteries.