Electric Car Sales Crash In Georgia As State Incentive Disappears

2 years ago by Mark Kane 52

EV Sales In Georgia

EV Sales In Georgia

Thanks To A $5,000 Incentive On Electric Vehicles (and falling MSRPs in the US) - Atlanta Was Transformed To The "Hottest" Market On The Plant For EVs

Thanks To A $5,000 Incentive On Electric Vehicles (and falling MSRPs in the US) – Atlanta Was Transformed To The “Hottest” Market On The Plant For EVs

Watchdog.org alerts us that Georgia’s electric car sales crashed after the $5,000 state incentive established in 1998 disappeared three months ago.

A dramatic drop” described in the article is a pretty ordinary thing after the preceding rush to catch out on the $5,000 before its gone.

A subsidy was applied only to all-electric cars.

“According to Georgia car registrations, sales shot up as electric car buyers rushed to take advantage of the tax credit before it expired. But the numbers declined sharply in July and took a swan dive in August — the most recent month tabulated:

The decline from 1,338 in June to 148 in August represents a drop of 88.9 percent.”

Don Francis, coordinator of Clean Cities-Georgia Coalition, who was opposed to getting rid of the subsidy, said:

The tax credit “was an economic benefit to the state, it was an environmental benefit to the state, it helped jobs because all of a sudden we had people putting in charging stations and things like that,” Francis said. “And all of that was taken away in one fell swoop.”

State Rep. Chuck Martin, R-Alpharetta, who spearheaded the drive in the state Legislature to sunset the tax credit said that the credit only to all-electric cars was unfair (hybrids and plug-in hybrids weren’t rewarded):

“Second, when the state break of up to $5,000 was added to the credit of up to $7,500 the federal government already gives electric car buyers, drivers in Georgia could lease one of the lower-priced electric cars such as the Nissan Leaf for about $200 a month and end up spending very little money out of their own pocket.”

“It was essentially taking money that would have been paid into taxes in Georgia and a subset of people were getting their car paid for.”

The largest hit fell on the Nissan LEAF, which earlier benefited the most as a popular model. Sales fell down from 1,000+ in peak months to 66 in August.

“When you’re having a product that’s selling because it’s subsidized, what’s the push for Nissan to be innovative and make that car less expensive or more valuable to the consumer?” Martin asked. “I always said (the tax credit) was too open-ended, too generous and too targeted.”

Don Francis hopes that the tax credit will back after the next legislative session in January, with some changes to lower the value to $3,000 and include hybrids.

The other hit was a $200 annual road use fee.

More insights on the topic are available at Watchdog.org (see link below).

EV Sales In Georgia (source: Watchdog.org)

EV Sales In Georgia (source: Watchdog.org)

Source: Watchdog.org

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52 responses to "Electric Car Sales Crash In Georgia As State Incentive Disappears"

  1. Jonathan says:

    Big surprise! State’s need to keep these around until 200+ mile EVs become mainstream. Then if they fall off it will impact sales much less.

    1. Why did the Model S sales went down too then?

      1. Jonathan says:

        Because rich people care about saving money too!

        1. Skryll says:

          And because people that wanted to buy one anyways bought it a few months earlier to still capture the incentive, so the months before are inflated and the months after are deflated.

          Here is whats good though perhaps – prices to end customers typically already price in all the incentives. That is why tesla tells you ‘after incentive’ cost, and that is why solarcity and all the other big solar companies quote you a 10kW solar system for $45,000 instead of $31,000, then telling you that you get the 30% off from federal so your real cost is only $31,000. Funny thing is, if you pay a good solar contractor $10,000 in labor they can put up $15,000 of equipment to get you the 10kW system for $25,000. See how that works?

          Ideally we stop subsidizing big oil and add a carbon tax to the emissions caused by taxing gas or gas-car registrations instead of handing out some extra money to the people that don’t cause the upcoming CO2 disaster. The cost of global warming is going to be billions and billions, why do we allow any more fossil fuel usage without participating in the estimated environmental cost?

          I know we have a history of capitalizing on gains and socializing cost, i.e. weapon industry reaps benefits of all those wars we wage or incentivize (first arab spring, now european spring), and the government buys the weapons with our tax money.

          In a similar fashion the big oil companies have been reaping insane margins and wait for the government to clean up the mess with other peoples tax money again.

          That is why we need a change, total cost of ownership type calculation and have the people that benefit also participate in the cost they create by benefiting.

          Environmental accountability.

  2. I guess Rep Martin does not understand the relationship between air pollution and human health. The subsidy is intended to kick start an entirely new form of non-polluting transportation. You need to incent people and industries to get them to change behavior and try something new.

    1. scottf200 says:

      I think you missed this: “State Rep. Chuck Martin, R-Alpharetta, who spearheaded the drive in the state Legislature to sunset the tax credit said that the credit only to all-electric cars was unfair (hybrids and plug-in hybrids weren’t [were NOT] rewarded)”

      1. So why did Rep Martin not simply add PHEVs to the credit instead of yanking it and hitting EVs with higher fees?

        Georgia has prime coastline that will be increasingly threatened by severe weather events, rising sea levels and ocean resources that will be damaged by ocean acidification.

        Georgia needs to make a better effort of getting their citizens to drive zero emission vehicles.

  3. kdawg says:

    I agree the credit should be applied to all plug-ins. I find it funny Republicans (like Chuck Martin) don’t like credits for citizens of the state, but I’m sure love all of the corporate tax credits.

    http://www.georgia.org/competitive-advantages/tax-credits/

  4. Alonso Perez says:

    In other news, objects subject to the Earth’s gravity fall.

    I guess InsideEvs had to report this, but I think even moderately bright, single-celled organisms knew this was going to happen…

  5. It was NOT just the removal of incentives; BUT the addition of annual EV registration fees that has had a negative impact on sale.
    (a disincentive)

    Note: The biggest change was in the mass market affordable BEV, the LEAF. Sales of the higher priced PEVs like BMW i3 and Tesla Model S were less impacted.

    Also of note, Tesla is restricted from selling more than 100 vehicles per month in Georgia due to lobbing efforts by the states auto dealer-franchise association.

    What would be most interesting is to track PEV registrations in Georgia. My intuition indicates that used PEV sales and imports from other states has arisen since Georgia has place disincentive on new PEV sales.
    ie: what is total number of PEVs register in Georgia, and is it increasing each month?

    1. sures says:

      polluters pay .26 cents per gallon in Georgia. for $200 you can drive a truck that gives you 15mpg for 12k miles. this is f*ing ridiculous.

      1. sven says:

        You’re not counting the $0.184 federal excise tax on gasoline that is avoided by driving an EV in Georgia. The federal gas tax should be factored in when analyzing the fairness of Georgia’s $200 annual registration fee. The amount of federal highway funds allocated annually to individual states is based on the federal gas tax collected in each state. Since EVs in Georgia don’t pay any federal gas tax for the miles they drive, Georgia gets short changed when the federal government hands out federal highway funds which are funded by federal gas taxes, and allocated among states by the amount of federal gas tax collected in each state.

        ICE drivers in Georgia pay $0.46 to $0.47.8 per gallon in federal, state, and local taxes.

        http://www.gaspricewatch.com/web_gas_taxes.php

        https://en.wikipedia.org/wiki/Fuel_taxes_in_the_United_States#/media/File:Gas_Tax_Jpeg.jpg

        1. suresh says:

          ok that makes it more like driving a car which gives 28 mpg. so its not f*ing ridiculous.

        2. Mike616 says:

          Cancelled out by slowing down the Flood Damage the FEDS will be paying for.

          1. kubel says:

            If you really want to make a personal impact on global warming, the best thing you can do is simply reduce your intake of meat and dairy products. Switching from a gas car to an electric car won’t have as much of an impact.

            Of course, I say this as being both a gas car (17MPG avg) owner and an obese meat eater. 😛

            But I also have a LEAF.

            1. VFanRJ says:

              I think you make a great case for being both a vegetarian and EV driver.

        3. Alonso Perez says:

          But road wear is fundamentally a function of trucks, which all passenger cars in effect subsidize. So talking about “fair share” for EVs sustaining road costs starts off with an invalid premise to begin with.

          Trucks not only tear up the pavement, they also rule structural load calculations for bridges, pavement thickness, rebar (in the case of concrete), and so on. They bear nowhere near the cost they produce. If they did, rail would suddenly be much more competitive.

  6. Bob says:

    Woah thats a prang! But perhaps many people prefer their purchase and sales will recover in some months.

  7. Mark C says:

    I suppose they sell about as well {or still better} now as Alabama EV sales, since AL hasn’t offered any incentives at all.

    1. Texas FFE says:

      The population in Georgia is much larger than in Alabama. Georgia also has about ten times as many DCFC charging stations as Alabama. A better comparison would be to Texas.

  8. Stephen says:

    Insideevs needs to look changes in WA State. Has sell rate dropped?

    1. Rich says:

      Good point. Context would help understand how much of this trend is rebate related vs sales trends due to declining inventory levels.
      Redmond WA 200 Nissan Leafs in stock.
      Chicago IL 67
      Atlanta GA 78
      Smaller cities, inventory is in the teens.

      1. Larry says:

        I believe my local Nissan deal does occasionally have one in stock….

  9. Anon says:

    Republicans just want to preserve the status quo for their Corporate Masters, for as loooong as possible. :p

    1. SparkEV says:

      Not all Republicans are the same. There are those who favor small government, and think giving back tax money is a good thing, especially when it results in less imported oil. Then there are socialist Republicans who want to grow the government, but don’t want to give any back to taxpayers, and continue to fund ISIS by encouraging oil imports.

      1. GeorgeS says:

        “a socialist republican”

        interesting concept :]

        1. GeorgeS says:

          Actually we have quite a few “socialist Republicans” here in Az.

          They can be seen at the local grocery store wearing a side arm and buying groceries with food stamps then pulling out a wad of cash to pay for cigarettes and beer.

          Then they get in their “camo” Jeep with an “Impeach Obama” bumper sticker and head on home to watch TV.

          1. Speculawyer says:

            Really? Now those are some sad folks.

        2. Texas FFE says:

          The first Republican president was Abraham Lincoln. The Republican strength and weakness is that they tend to focus on the particular side of an issue. Some times it’s good and some times it’s bad but you have to admire their resolve.

          1. Nick says:

            Lincoln was a Republican in the era before the Democrats and Republicans switched sides.

            1. Anon says:

              +1

              Today’s Republicans, would not fight to free slaves.

              1. Texas FFE says:

                I think you’re very wrong. This stereotype is just insulting. The Republican Party is about commitment, about getting things done about righting wrongs. The only problem I really have with the Republican Party right now is I wish they would get firmly behind renewable energy and energy sustainability. If the Republican Party got behind these issues we would see a lot more progress on energy security and combating air pollution and climate change.

                1. VFanRJ says:

                  The reason why the Republican Party can’t acknowledge climate change is because they are against all kinds of regulations.

                  And the Republican Party can’t be for renewable energy because Obama go there first and they oppose everything he does.

              2. Texas FFE says:

                I would also like to point out that Energy Inpependane and Security Act of 2007 was developed under and was signed signed Republican President Bush. This is the most far reaching law related to renewable energy and energy sustainability that’s ever been passed in the United States. Many of requirements of EISA07, from the development of renewable energy to the reduced energy consumption of buildings, impact our lives for the better every day.

      2. kubel says:

        I’m an anarchist so I get to be hated by both Republicans and Democrats. Hell, even minarchists think I’m nuts. 😛

  10. Speculawyer says:

    The Tax-credit in GA was definitely overly generous. And it appears that back-fired because it then got too easily painted as a huge subsidy.

    But it was stupid/unfair to complete kill it. It should have just been reduced. California only has a $2500 credit . . . and they’ve even limited that.

  11. Phr3d says:

    I get such a kick out of the ‘he said, she said’ demoblican/republocrat rhetoric..

    1. Speculawyer says:

      Do you really think they are exactly the same? If you think that, you are not very good at spotting differences. Both sides have their problems but they are certainly different.

      1. kubel says:

        As an anarchist, I see more similarities than differences.

    2. Nick says:

      “demoblican/republocrat”

      They are so different it’s crazy.
      They almost speak a different language.

  12. Texas FFE says:

    The northern part of Georgia has a pretty good DCFC network. I would expect EV sales to rebound quite nicely once people get over mourning for the rebate.

  13. Texas FFE says:

    Texas had a $2500 rebate for EV purchases last year but very few people, including the auto dealers, knew about it. The rebate was not a factor in my new plugin purchase last year. I did apply for and receive the rebate later but I felt it was a reward for doing something socially responsible. The $2500 rebate has expired but Texas currently has a $3500 rebate available for low income families. The low income rebate is even available for used EVs. Texas has the same problem with the $3500 rebate as it had with the $2500 rebate, nobody knows about it. There is no expiration on the $3500 rebate, it’s good until the funds run out. It looks like the low income rebates are going to be the standard going forward so that people who need the rebates the will be the only people that get them.

    1. Josh says:

      Agreed that the $2500 rebate was not advertised enough.

      Every dealer I talked to said they didn’t know about it, or if a potential purchase would qualify. They also didn’t seem to care (since they really don’t care about selling plug-ins).

      Good to know about the $3500 rebate, I’ll check out the details in case I know someone who qualifies.

  14. Ian says:

    Start charging yearly carbon tax on all ICE veh and use that money for highway construction. With that in place you do not need a tax rebate on electric cars. The tax re bait effect will continue except from the other side of the spectrum… People will avoid carbon tax through electric vehicle purchase accelerating electric veh adoption to the mainstream.
    Then pass legislation requiring all fuel stations to install electric vehicle charging stations.

    1. Taser54 says:

      Start taxing children and large families

  15. Rich says:

    This could be a very interesting insight into the consumers value proposition gauge. If the cancelled GA state rebate is the sole reason for this decline, the decline might indicate people are willing to settle for an 84 mile range car if the car is at a much lower price (sub $20K). To state the obvious, $34K for an 84 mile range car is only going to appeal to a small percent of the population.
    However, there are at least 2 other factors at play. 1) Inventory levels are declining due to a model year change from 2015 to 2016. 2) The new model year has a 20% increase in range for under $2K increase in price (depending on the model level).

  16. Spider-Dan says:

    I’m certainly all for more EV sales, but the GA EV rebate was basically just free money for Nissan. The amount of the rebate was such that the lease was almost literally a free car for 2 years.

    Sorry to say it, but Leaf sales in GA were almost entirely a sham.

  17. Texas FFE says:

    All the states in terms of road construction and maintenance are in trouble. About 40% of road repair and construction is paid for with gas taxes and those revenues are decreasing rapidly. Electric vehicles haven’t made much of an impact on gas sales but the CAFE standards sure have. Every year the Corporate Average Fuel Economy requirements go up and that means less gas being sold and less gas tax revenue. The states going to have to find other revenue streams to pay for roads. As we move towards a zero emission transportation system the problem is just going to get worse. The states are going to find all kinds of ways to pay for roads and we are not going be happy about most of them. Get use to paying these taxes, they are going to be a new fact of life.

  18. rad says:

    These are the same people that are worried about taxes that ended the excise tax on annual car registration. Pay it once when you buy a car, then $20 a year for plates after that in GA. I pay more to register my utility trailer than my two year old car.