Ford Mustang Mach-E, E-Transit To Lose Half Their Tax Credits

Eligible customers taking delivery of any Ford EV before April 18 can still get the full $7,500 credit, though.

Ford Mustang Mach-E at charging station

Dan Mihalascu

By: Dan Mihalascu

Apr 6, 2023 at 7:52am ET

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Ford has officially confirmed that all three of its battery-electric vehicles currently on sale in the US qualify for the revised Inflation Reduction Act federal tax credits in 2023.

Following the release of additional guidance from the US Treasury Department, the Mustang Mach-E, Ford F-150 Lightning, and E-Transit remain eligible for the incentives, but the Mach-E and E-Transit lose half of the maximum credit.

The Mexico-made Mustang Mach-E and Kansas City-built E-Transit get a credit of $3,750, half the maximum amount of $7,500. Despite the fact both vehicles are made in North America, they are penalized because of the new battery rules going into effect April 18.

More specifically, Ford lost the portion of the credit related to domestic sourcing of batteries for the Mach-E and E-Transit. Eligible customers can still get the full $7,500 federal tax credit for the F-150 Lightning, though.

2022 Ford Mustang Mach-E GT exterior

The requirements about where the batteries and the materials used to make them come from will be released soon by the Internal Revenue Service (IRS), along with an updated qualification list.

"Customers made Ford the No. 2 electric vehicle brand in the US last year, and as we scale our production to build more EVs for more customers, we believe this new incentive eligibility will help even more Americans join the EV revolution."

Marin Gjaja, chief customer officer, Ford Model e

Ford also confirmed that all its plug-in hybrid models sold in the US are eligible for federal tax credits, although the Escape Plug-In Hybrid and Lincoln Corsair Grand Touring qualify for only $3,750. The Lincoln Aviator Grand Touring remains eligible for a $7,500 credit.

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Now, if you're a prospective Ford Mustang Mach-E or E-Transit customer and want to seize the current tax credit on any of them, the automaker says any eligible customers who take delivery of a Ford EV prior to April 18 will be eligible for $7,500. It doesn't matter when the vehicle was bought – it only qualifies for the "old" tax credit if it gets delivered before that date.

As an alternative to the consumer incentive, commercial customers are eligible for commercial tax incentives of as much as $7,500 on all these vehicles.

2022 Ford E-Transit