EV rebates could provide a boost to US automakers, especially Tesla and GM. However, potential changes could tell a different story.
President Biden's proposal seeks some $174 billion for increase electric car adoption in the US. Of those proposed funds, $100 billion would be earmarked to use as rebates for electric car buyers. Another $15 billion aims to support EV charging infrastructure via the construction and implementation of 500,000 domestic charging stations.
This information all comes from an email that the US Transportation Department sent to members of congress. The email was obtained by Reuters and reported via Politico and Automotive News, among other publications. The plan to support EV adoption is a significant portion of the total infrastructure bill, which calls for some $2.3 trillion in total.
The electric car rebates could provide a major boost to US automakers that are producing EVs. However, it could have a special impact on GM and Tesla, since neither company is eligible for the current $7,500 US federal EV tax credit.
Both automaker sold over 200,000 electric cars, and sadly, their massive push for EV adoption has ended with them being indirectly punished. Meanwhile, automakers that have been slow to move forward with EVs are still enjoying the benefit of the tax credit. In addition, the credit, as it currently stands, helps foreign automakers as much as it helps domestic carmakers.
With that said, there could end up being changes, a catch of sorts, built into the plan, that could actually work against Tesla and GM. Tesla is a US automaker and the world's leader in EVs, though most of its cars tend to be expensive. GMC's Hummer EV, as well as upcoming electric Cadillac models will have very high price tags, too.
US Senator Debbie Stabenow and Representive Dan Kildee are working on a bill to update the tax credit. Kildee hopes to set up a credit that favors affordable vehicles with long range. While this could work in favor of Tesla's Model 3 and Chevy's Bolt EV and Bolt EUV, it could also work against many of Tesla's and GM's vehicles. However, it all depends on the details, and whether or not there's some sort of price cap. Kildee said the plan is:
"... looking at ways to make the credit more accessible to middle- and lower-income families, potentially even making the credit refundable."
As with any new proposal, many changes will likely be made before a bill comes before congress. At this point, it's really too early to draw conclusions. It's just a waiting game for now. Let us know what you think by leaving a comment below.