National Automobile Dealers Association Whines Over $10,000 Point-of-Purchase EV Credit

5 years ago by Eric Loveday 16

President Obama's Proposed $10,000 Point-of-Purchase EV Credit Doesn't Sit Well with NADA

President Obama’s Proposed $10,000 Point-of-Purchase EV Credit Doesn’t Sit Well with NADA

Last week, President Obama revealed his 2014 budget proposal to Congress.  For fans of plug-in vehicles, there were 2 items within the proposed budget worthy of mention: $10,000 point-of-purchase rebate for electric vehicles and $575 million in proposed spending for the DoE’s “EV Everywhere Grand Challenge.”

NADA Logo

NADA Logo

It’s the $10,000 point-of-purchase rebate that seems to be drawing the most criticism, both from EV naysayers and the National Automobile Dealers Association (NADA), but why?

Under the proposal, the tax credit–currently $7,500–would jump to $10,000 and turn from a tax credit to a direct point-of-sale rebate.  Seems simple to us, but NADA says otherwise.

Bailey Wood, a spokesman for NADA, says dealers are all for incentives, as they typically increase sales, but complains that this point-of-purchase setup is flawed.  As Wood claims, it’s too complicated.

Wood suggests that by transferring the credit to the dealer, it becomes to difficult to figure out who can claim it and at what point in time it can be claimed.  Wood’s argument would make more sense if we re-worded it in a bit of an unusual way, so here goes…

  • Does the dealer claim the $10,000 credit? If so, then how long will it take after the purchase of a vehicle  for the dealer to get reimbursed?
  • Does the customer claim the $10,000 credit?  If so, is this credit instantly given to the customer?
  • If the dealer claims the credit, then will uniformed buyers even realize it exists?
  • Will a dealer receive any advance credits?  Or will they always be in the hole by $10,000 while waiting to receive the credit from the Feds.

The most likely scenario is that the dealer will claim the credit after the sale and, as long as they aren’t corrupt, will pass the $10,000 directly to the buyer in the form of a deduction off the vehicle’s sticker price.  So, yes, the dealer will technically be in the hole $10,000 as it waits on the money from the Feds, but $10,000 is like pennies to most dealerships.

But dealers say claiming the credit will heighten their workload.  Paperwork will have to be filed correctly, some phone calls might need to be made and a waiting game played while the $10,000 credit goes through the federal channels on its way to dealerships.

This, in our eyes, is fine.  It’s how the program should work.  Dealers sell tons of vehicles, file paperwork constantly and are staffed to deal with these sorts of things, while most consumers are not equipped to deal with the complexities of the federal government’s overly complicated ways.

Still, Wood says:

“We just don’t think it’s workable in the showroom.”

If the proposal passes, then we say to Wood, “Make it work.”

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16 responses to "National Automobile Dealers Association Whines Over $10,000 Point-of-Purchase EV Credit"

  1. Paul says:

    It sounds like a no-brainer to me. This would be HUGE help to EV sales. If a little paper-work is too troubling to some dealers, consumers can move on to a dealer that wants to make a sale.

    1. John F says:

      I think this could have mixed results on the sale of EVs. If a buyer knows he or she can get a $10000 rebate instead of only a $7500 tax credit just by waiting a few months, it could depress EV sales for months. In the mid term, that would be bad. It would delay the introduction of new EV models until the old inventory had sole out. I think that is what we see happened now to the Nissan Leaf. Nissan did not keep secret the fact that the 2013 model built in Smyrna would cost less, and 2012 sales slumped. Of course when the new less expensive 2013 Leaf became available, the sales hit a new record, and thats what I think would happen when a $10000 rebate kicked in.

  2. Mark H says:

    If the proposal passes, then we say to Wood, “Make it work.”
    +1

  3. MTN Ranger says:

    Ungrateful whiners. And you wonder why Elon Musk wants them gone.

    1. GeorgeS says:

      You beat me to it.
      One more reason to dislike NADA.

  4. When do Auto Dealers pay manufactures for the vehicles on their lots? When do Auto Dealer pay taxes collected on vehicles sold? Correct me, but are Auto Dealers not required to report number(s) of vehicles sold to federial government each month, or is that a manufacture responsibility? (For Highway Safety, EPA, etc.)

  5. Fishhawk says:

    How is the $10,000 point-of-purchase rebate any different than a manufacturer’s rebate on certain models? If they can figure it out with manufacturer rebates, surely they can run the government rebate the same way.

  6. Bonaire says:

    Make it a manufacturer rebate and make the manufacturer do the federal paperwork. Dealer can just do the same standard rebate stuff they already doubt add 10k to it.

  7. Nelson says:

    I’m sure Tesla will have no problem processing the $10,000 credit when you purchase a Model S.

    NPNS!
    Volt#671

  8. kdawg says:

    So would Tesla get $10K for each Model S it sold? Direct to the MFG?

  9. Turbofroggy says:

    Why would this be any different than the cash for clunker rebate/credits? They seem to be able to handle that just fine. The NADA is complaining only because the instant rebate is only on EVs because that is what their oil company puppet masters have told them to do.

    My local Nissan dealer, would disagree with the NADA and their BS. My local Nissan dealer sold more Leafs last month than ANY OTHER NISSAN MODEL they SELL. Plus they have more Leafs on hand than ANY OTHER MODEL. It think they would be perfectly fine with the $10K instant rebate, bring it on…

    1. Herm says:

      they complained about the cash-for-clunkers also, and it saved a lot of dealerships

  10. Future Leaf Driver says:

    Why is this sooo hard to figure out? This is exactly how the rebates in Canada work for all EVs. The rebate comes right off at point of sale. No FED discussion required!

  11. Same in UK – manufacturer charges dealer £5k less.

  12. Roy_H says:

    NADA seems to be going out of their way to piss off customers. Clearly anti-EV. Elon is so right to avoid these characters in selling Teslas.

  13. Raymondjram says:

    I approve the $10,000 rebate for EVs if this only applied to an American produced vehicle. So Tesla, GM, and Ford get it.