OP-ED: Why the repeal of the $7500 Federal Tax Credit is probably nothing to fear

NOV 3 2017 BY DAVID MURRAY 73

Did these future Model 3 owners outside of Tesla’s Sunnyvale, CA Store on March 31st, 2016 assume the $7,500 federal tax credit would be available for them when they got their cars? (InsideEVs/Scott F)

So, the news broke Thursday that the Republicans are wanting to axe the $7,500 federal EV tax credit.

This is not really a big surprise to most of us. As soon as Trump was announced the winner of the 2016 election, most of us guessed this would probably happen. So, I’ve been thinking about this inevitable moment for a while and to be honest, I’m not as worried about it as you might think. I want to give you some of that comfort as well. In fact, the Republicans may even be doing the EV movement a favor.

Consider this. Most of Tesla’s hundreds of thousands of customers who have reserved their copy of the Model 3 most likely knew already that they would not be getting the $7,500 EV tax credit. That didn’t stop them from reserving.

General Motors Buick Chevrolet

The introduction (and US reception) of the Chevy Bolt EV has pulled forward GM’s 200,000th sale by at least a year (now expected in Q2 2018)

Elon Musk himself has actually stated at times that he doesn’t like the EV credit and that it isn’t good for his business. And that’s good news. Tesla is, without a doubt, the main thing fueling the EV fire right now, not government mandates. I’m quite sure that if not for Tesla, most auto makers would still be producing compliance cars that were “just good enough” to sell, but not good enough to grow an industry. As long as Tesla stays in business, the other car manufacturers have no choice but to attempt to compete with compelling alternatives.

Now, consider this. General Motors has already used around three quarters of their allotted tax credits, and would have probably run out next year anyway. GM has been aware of this for some time. And yet, they have continued to announce big plans for an EV future with as many as 20 new EV models on the horizon. It sounds like GM doesn’t think it needs a $7,500 tax credit any more than Tesla does.

Nissan LEAF/Ohio AEP deal from May

And consider this too. Nissan has been selling the Leaf for the last year with as much as $10,000 off of MSRP. Now, if this were unprofitable they would have probably just stopped making the car and waited until the 2nd gen model came out. I suspect that over the last 7 years they have managed to get the cost down on both the batteries and the drive-train to the point that they could have sold that vehicle with an MSRP that was $7,500 lower and still made a profit. Granted, the 1st gen Leaf is now essentially sold out. But they, much like GM, must have been aware that the 2nd gen Leaf would run out of tax credits probably within a year as well.

Now, I’m going to make a few predictions. I suspect the MSRP of these vehicles will drop soon after the tax credit is gone. I suspect the manufacturers have been planning for this for a while. And that will actually be good for business. Many average car buyers see the sticker prices on these EVs and PHEVs and their level of interest dies right there. Few will bother with checking into tax credits or long-term cost-of-ownership analysis. But when the MSRP drops by $5,000 or so, that will make an enormous difference.

Plug-in hybrid EV

Toyota Prius Prime may benefit compared to some other plug-in offerings due to its current MSRP

However, if the price doesn’t drop like I predict, then short range PHEVs like the Toyota Prius Prime will have the biggest advantage in the market. Right now it’s a few grand cheaper than the Chevy Volt even with tax credits, despite the fact it gets a smaller tax credit than the Volt. But, take away the credit for both manufacturers and you end up with the Prius Prime being $6,200 cheaper than the Volt and almost $10,000 cheaper than a Bolt EV. With that much price disparity, I could see a lot of potential EV buyers settling for a Prius Prime instead. So, this would be a win for Toyota. But I honestly don’t think GM would let that happen.

There’s a lot of fuzzy math when it comes to figuring out how much profit is or isn’t in an EV for a given manufacturer. Obviously they need to deal with CARB credits, which means they can afford to lose up to thousands selling an EV if it means they won’t have to buy that same credit from somebody else (or they can sell those ZEV credits if they have excess). But that won’t help the market that much because you’ll just wind up with a bunch of cars like the Fiat 500e. They never intended to make money on that car. Any vehicle that is going to make a profit needs to sell more than a few thousand per year.

So that means economies of scale are important. And if manufacturers can’t make a profit selling a few thousand then they need to get ready to sell a few hundred thousand, or not sell any at all. As long as Tesla is around, not selling any at all won’t be a long-term option. And despite delays on the model 3, Tesla is still going to be around for a while.

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73 Comments on "OP-ED: Why the repeal of the $7500 Federal Tax Credit is probably nothing to fear"

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If this does happen there will be a lot of sales in 4Q 2017 and then a drop in 2018 because people moved their buying decisions forward, and everybody will proclaim the Death of EVs…and then MSRPs will come down and things will go on.

If you look at countries that do not offer tax credits or incentives on EV’s.
See what level their EV sales are at and the fact that the cost to buy an EV is no less than counties that do offer EV incentives.

Bingo.

This entire article is an incoherent collection of fallacies, mistaken assumptions, and wishful thinking.

I see this writer has had several articles published at InsideEVs, but this one should have been rejected.

I disagree Pu-Pu. I think the author is correct, that MSRPs will begin to float down a bit once the tax credit expires. Will they float down $7500? Probably not, but $3 to $5k, yeah I think that’s likely. Then they can offer cash on the hood to make up some or all of the rest. Over time manufacturers can also freeze the MSRP of EVs while increasing their ICE counterparts 2% – 3% each year to get the same impact without the “shocking” news that they have reduced MSRP.

“If this does happen there will be a lot of sales in 4Q ”

I know I’m suddenly scrambling to find a Pacifica plug-in “e hybrid?” before 1/1/18 as our 2nd plug-in. The wife insists that one of our cars have 3 rows. We were going to wait a few more months on the thing in case there was going to be another batch of rejects like the ones that came out last April but gonna have to take a leap of faith now. Fingers crossed.

(⌐■_■) Trollnonymous

“of the Model 3 most likely knew already that they would not be getting the $7,500 EV tax credit.”

Exactly!

I’m buying in 2020. My expectation is there will be no fed tax credit available for me.

Might not even be a CA State rebate either by then.

People who need the tax credit to afford the Model 3, don’t have enough income to have enough taxes to get the full tax credit in the first place.

Ahh that may be true but there are plenty of people who can afford the Model 3 and would get one if they could get it for $7,500 cheaper but not if they can’t.

I’m in that bucket. If they actually get rid of the $7,500 federal tax credit I genuinely don’t know if my next car will be an EV. EVs in general cost more and deliver less of a product. $7,500 buys a hell of a lot of gas. By the end of next year if they do get rid of the federal tax credit in 2017 here’s to hoping they find a way to dramatically drop the price of the car.

I don’t get how people think the manufacturers are baking in the $7,500 to the cost of the car. Perhaps the MSRP but only people who buy Tesla’s pay MSRP. When you look at what cars cost elsewhere where there are no incentives it’s not like the cars are magically cheaper there because of the lack of incentives.

I doubt anyone who could get the $7500 credit would turn it down if available. But that’s not the topic here.

It depends on your logic an reasoning for getting an EV. If it’s about offsetting fuel costs then, no, maybe an EV is not for you, until batteries come down in price to the point where it makes more sense in that way.

But the total package of what an EV is, makes it appealing. The way it drives, how you’re not adding CO2 (when used with a solar generating home), maintenance, reliability and even HOv privileges in some states.

I don’t know who would refuse the $7,500. My point was that I’d be willing to drop $35k before incentives on a new car but if the incentives go away I wouldn’t be. It’s not that I can’t afford it by any stretch just that I don’t think the EVs are worth it. While they do have positives they also have a lot of negatives, something which frankly the incentives really help people overlook.

It is a consumer’s ultimate decision of what constitutes value, that is correct. But considering that the Model 3 was always aiming at the BMW 3/Audi A4, without incentives, it’s still competitive. It’s not the BMW at a Toyota Camry price as with the rebate that a lot of reservation holders were hoping for, but it still has the Brand of Tesla which has cachet.

Not quite true. I don’t make enough to have the taxes needed for the credit but I leased a new Leaf and the dealer took the credit and applied it to the lease. They also gave me a whacking great discount on top of that. It brought the total cost of a new 2015 Leaf SV down to $24,500 *including* the cost to buy out the lease.! Now THAT was affordable!

Tesla isn’t offering a lease on the Model 3.

Long term incentives hurt car residuals, so lease prices may remain the same without those same incentives (in this situation tax credit) as residuals will increase.

Shoppers consider new price when deciding how much to pay used. Tax credits lower lease rates which make the used version less financially attractive.

Cool.

Dude, I hate to brag (no I don’t) but I’ve got you beat. Leased a 2015 S in GA before the state rebate went bye bye, then bought the lease out in April of this year when Nissan was still offering a $6k incentive to do so. My total out of pocket on the car after incentives and discounts was $13.5k!!! AND NEVER BUY A DROP OF GAS. 🙂

This may help the Leaf a bit, a marginal number of people will have to move down to the new Leaf.

And lease first, and then buy the car at the residual price at the end of a 3 year lease.

I very much hope the current form of the EV Federal Tax Credit is repealed.

I’ve never liked the idea of the traditional car maker EV laggards being able to game this tax credit by sitting on the sidelines waiting for the credits to run out for the EV early intranets (Tesla, GM, & Nissan) then jumping in and having a net price advantage over the early EV entrants.

That said, I’d like to see some type of tax benefit for EV purchases perhaps similar as as formulated for solar ITC Tax Credits.

I’m generally against the concept of tax credits but in the case of it serving as a catalyst for enhanced national energy security I’m in favor of it.

Yes, I always say this. The OEM’s should be competing to get these credits.

Ford could wait and buy the entire drive train from LG in a few years and sell millions with their $7500 advantage.

This will kill the EV market in the USA. The folks who really want EVs already own them. Everyone else is kind of “meh?” about them and will jump in when the price is comparable to gas powered cars. Sales of EVs will tank once the credits go away and the big auto manufacturers will see them as a money loser and will stop developing them. I can see Tesla surviving in the high-end market with the Model S and Model X but that’s about it.

Oh how wrong you are.

It will drop at first, but you haven’t accounted for 500K Model 3 reservations. Sure, some will bail! But most will stick. Demand still far exceeds supply! Clear thru 2018. As more 3s are driven! I expect even higher sales in ‘19 and ‘20.

@me said: “This will kill the EV market in the USA…”
———–

I see it otherwise.

Repeal of the EV tax credit greatly benefits Tesla, GM, & Nissan … these three car makers being early EV entrants and having already consumed a large part of their EV tax credit allocation were essentially price subsidized to offset initial capitalalized R&D and they will use that to their advantage against the traditional car maker laggards.

There is no turning back the EV revolution and Tesla, GM, & Nissan now have a wider advantage in the EV space as early EV entrants.

Not to metion that GM, Ford, VW, Nissan, Honda, and Toyota all have to build boatloads of EVs for China so the design devolepment and engineering costs can be spread out via economies of scale and the true BEV cost driver is the price of rapidly falling batteries…
Plus as the article kinda of stated BEVs are hugely over priced…
100 mile BEVs have been MSRPd for 30k yet Toyotas engineerer in charge of EVs stated over a year ago that a 100 mile BEV is currently cheaper to produce that a hybrid and Toyota sells hybrids for as little as 20k…
Looking at GM online parts sites and adding up the cost of Bolt BEV componets at consumer MSRP tells me GM has to be making a lot of money selling at 37k unless they are selling parts at a huge loss…

+1 CDAVIS.
Though I am a bit irritated with Nissan for their laggard pace with regards to fielding a 200+ mile BEV, those are the Big 3 right now here in the US and Canada.

Nah. Life will go on after the young flourishing of BEVs. Regen is fundamentally, irresistibly smart. Its improved integration into vehicles’ drivetrains won’t go away, and will expand – especially into heavier local vehicles via REX. Think FedEx. There is also been great elasticity in the MSRP. Don’t forget, these tax credits were never really for consumers. They were subsidies to manufacturers, so they’d build the industrial tooling to make EVs. But the manufacturers only got a dime if they actually sold cars that customers wanted to own. They charged $7500 more. For all the IRS paperwork in our 1040s, the manufacturers actually took the 98% of consumer surplus off the table and invested it in tooling. Now, having largely built the tooling, the marginal cost of cranking out another EV is zero, plus the cost of the battery, which is basically linear. That was always the point. I think the market will find equilibrium at a PHEV with ~32 AER. kWh will vary by vehicle weight. That’s 90% electric for most people, 99% of whom own only ICE vehicles today. Of course, this will end fool cell vehicle development entirely. See? Now we’re all friends again! 🙂

me said:

“This will kill the EV market in the USA.”

No, but it certainly will depress the market. Just look at what happened to EV sales in Georgia when its State EV incentive was discontinued. Sales plunged off a cliff.

If what the hopeful here are saying was true, then sales in Georgia would have recovered by now. But sales figures show quite plainly that they have not.

Just as as point of interest, Georgia sales have regressed more to the nation al norm (actually they are still about ~300% higher than similar states in the region – probably because more people are seeing/have experienced the wave of these earlier EV sales), but they can’t be replicated in the same way (for a lot of reasons) – as it was a one-time anomaly. For example, plug-in sales in 2017: Georgia (10 million people) – 2,000 plug-in sales Alabama directly to the west (5 million people) – 275 sales South Carolina directly to the east (5 million people) – 425 sales Tennessee directly to the north (7 million people) – 650 sales …so statistically, this does show that strong incentives for plug-ins do increase future adoption rates (even after they are removed) AKA ‘if you drive a plug in, you are likely stay a plug-in driver’ and you convince others at the same time to do the same — — Moving on… In Georgia, the 5k rebate was not intended to work as it did in conjunction with the fed credit (it was an old incentive program that was just not wound down)…and only the slow-moving pace of the… Read more »

The Georgia $5000 tax rebate was different than the federal in that it could be carried over to four additional years. For persons such as myself, I could only use $2000 or so for the federal rebate, but could use the entire $5000 state over several years. I know I could lease and have the federal credit rolled into it, but have never leased a car before.

I was really surprised when they ditched the tax credit. Most of the sales were around the Atlanta area, which has failed the air quality test for the last twenty years. With a smaller EPA, maybe they won’t bother to test the Atlanta air anymore.

Those companies who have chosen to not field any EV’s ( honda and Toyota) will be bringing 1st gen ev’s to market against companies who have taken advantage of the $ and sowed seeds in the market.

they are and will be at a disadvantage.

I wouldn’t count out either Honda or Toyota’s ability to field competitive plug-in electric vehicles in the future.

Toyota, especially, has massive experience building electrified power-trains through the millions of hybrids they’ve sold, and it looks to me like they engineered the Prime to be affordable with or without the federal rebate.

How many republicans are for eliminating fossil fuel production deductions? ZERO LOL

They won’t because they believe that it’s necessary to prevent rape.

http://nypost.com/2017/11/02/rick-perry-claims-fossil-fuels-can-prevent-rape-in-africa/

You do realize that he is right? That London, Paris, New York all put in lighting at night to deter crime? Or do you think Africa is different? Cheap energy is a useful tool for measuring a societies ability to grow and to increase wealth. And fossil fuels are still cheaper to use, at least initially, than renewables. It is getting closer all the time, but there is a logical reason growing nations look to fossil fuels for electricity generation. They don’t require backup energy sources like wind and solar, for one thing. And admittedly, some of their costs are externalized so they are easier to ignore at first.
Do you really think that a poor neighborhood (whether it is in Africa or New York City matters not) that can’t afford electric street lights will be as safe as the same neighborhood if they can afford street lights? Really?

We don’t need to hear the arguments going on inside of your brain as they are happening. Please write once you’ve figured out what conclusion you’ve come to.

Is that a red herring or an ad hominem fallacy you are trotting out there, Lawrence? It has aspects of both but your whinge doesn’t change the fact that Rick is right and the attacks on his statement of the obvious shows how lacking the left is at finding an adult response.

I’m actually a conservative in most aspects, Perry’s statement is a long stretch in which a person would have to disregard many other facts, such as the fact that rapes in South Africa happen frequently during the day. The biggest contributing factor isn’t the lack of electricity or lighting, it’s that the country is at a boiling point. Places with high rape rates also have high rates of murders. Murders per capita is higher than any non-war zone. Will murders also go down with fossil fuel powered lights? That’s just asinine.

Yeah, that was a stupid comment by him, Rick Perry, but it’s the way these guys try to make excuses. What if someone asked would not alternative energy be even better then, since it also does not destroy the environment.

It’s only one factor in a problem, that as you suggest, is multi-faceted. But the simplistic thoughtless answer is what I have come to expect from this particular idiot, and the other idiots Trump, the top banana, has on his team.

Completely agree. It would be completely short sighted to spend the time and money on a short lived, end of life solution when alternative energy is agreed as a long term solution. Whatever extra cost there is in alternative energy would have a ROI over time.

There is no reliable electrical infrastructure so building larger power plants rather than smaller micro grids with alternative energy is a waste of time and money in itself. Think of it as the reason that developing countries with little existing telecom went straight to cellphones rather than laying landlines all over their country.

Of course there is a motive to push building systems that need fossil fuels if your constituents produce the stuff.

“…the reason that developing countries with little existing telecom went straight to cellphones rather than laying landlines all over their country.” The reason is that putting up a few cell towers, and installing electronics that are now rather inexpensive, is a heck of a lot cheaper than erecting telephone poles and stringing copper wire everywhere. The analogy most definitely does not hold for electrical power. Every home owner installing his own solar+wind system with a battery backup, for reliable power at night and when it’s heavily overcast, would be a much, much higher cost than installing a centralized power generation and distribution system. For example, those small wind turbines you see people put up at single family dwellings may make them look “green”, but the reality is that they don’t provide more than 1-2% of the electricity such a house needs. A real wind farm might feed a local power grid or feed into a regional grid, but either way you’re gonna have to have a distribution grid balancing supply and demand, and carrying power to individual buildings. Likewise, it may make economic sense for many home owners to put solar panels on their roof, but not all buildings have… Read more »

Lawrence, the UN has funded studies that show that increasing lighting in previously unlighted areas can decrease sexual violence against women. Who are we to argue with the UN? Rick was right.

http://www.unwomen.org/en/news/stories/2013/5/better-lighting-wider-pavements-steps-towards-preventing-sexual-violence-in-new-delhi

Ziv said:

“…how lacking the left is at finding an adult response.”

Speaking of widely aimed ad hominem fallacies, I see you’re rather fond of them yourself. 🙄

@Mister G said: “How many republicans are for eliminating fossil fuel production deductions? ZERO…”
——-

Wrong… the current Repuclian House proposed tax plan that eliminates the EV Tax Credit also eliminates/lowers *some* fossil fuel subsidies.

Just to preface these are all just proposed tax changes, and so far this congress has been just as inept as the several previous ones at passing laws, despite holding a majority of votes…

Back to the topic at hand. The proposed removal of the fossil fuel credit for marginal wells is a joke token that does not have a impact on the industry. The proposal is to removed the tax credits for wind and solar that were passed by allowed crude oil to be exported for the first time since the 1970s.

So really, if these credits are removed, the right to export crude should also be revoked. That is a huge financial gain to the oil companies who are overburneded with supply. None of the oil majors are worried about cost of underproducing wells.

P.S. I am independent and think both parties are compromised. I work in the energy industry, live in Houston and dispise the manipulation from D.C. The back and forth threat of policy change (both directions) is bad for business.

*** I hate typing on iOS. Back to the forums (with edit) for me.

If car makers had these mythical additional $7500 dollars in extra price padding in pure extra profits on top of their normal profits, the Monthly Score Card numbers would be much higher.

Does anybody actually think that GM’s cost for a Bolt is in the low 20’s or less? (wholesale price minus 7500, minus profit margin, minus overhead)

Cost per-unit? Absolutely they could absorb the $7500 MSRP drop and still at least break even. There is no reason it should be costing them more than $20k per car to build a base Bolt.

Now, if you factor in R&D, that pushes up the overall costs. But, that R&D can be spread across all cars sold, as well as other models. So, it becomes minimal per unit once they scale up production.

Well, they still do need to make a profit on each unit, at least 10%. They aren’t a charity.

And overhead (including R&D) can only put them negative for so long before they need the volume to kick in and do what it is supposed to do. Which is why Tesla is pushing so hard to go big in volume for the Model 3. GM doesn’t have nearly half a million Bolt reservations to work from, and Volt sales have been tanking. Exactly the opposite of building volume like they need.

Everything points to GM needing at least half the fed incentive to just break even (without including overhead) until volumes increase or battery pack prices drop.

Jan 2018 is too soon.

I believe the credit expiring will help GMs volume. Dropping the MSRPs $7500 will help direct comparisons to ICE vehicles. At the moment the average person is too stupid to factor in the credit when comparing the price of an EV to a similiar ICE.

GM likely can’t afford a $7500 price cut. See the numbers from UBS. Maybe half that much of a price cut.

The problem is that what the Bolt (and all EV’s) really need is an actual effective price cut. $30K is still to high for a Bolt. Exchanging an incentive for an MSRP cut won’t solve that.

And GM has already gone through trading discounts for cuts in MSRP. They did that right after their highest record summer of sales when they were throwing $5K on the hood. For the next model year they cut the price by $5K and then didn’t throw cash on the hood.

Sales dropped. By a lot.

GM buyers are price point buyers. They buy on discounts, not MSRP. Given the choice between buying a $37K car with a 7K discount, and a car with a $30K MSRP, they will go for the $7k discount every time.

There is a whole market psychology that explains how people are more apt to buy when they are convinced they are getting something of high value for less, vs. just getting an honest price.

All GM needs is cheaper batteries (and maybe better seats), as the car is comperitive. They have chosen a shared production line with another model, which cuts cost.
Their profit margin will grow.
You don’t know if they have included less aftermarket profit in their calculations too.
They have dealers profit to think about too. Sometime in the future, jobs will be lost in the auto industry.

“Does anybody actually think that GM’s cost for a Bolt is in the low 20’s or less?”

-Nix

UBS did a pretty decent analysis. If you leave out indirect costs, GM makes 3200$ on each BoltEV.

see figure 1

https://insideevs.com/swiss-financial-giant-ubs-tears-down-chevy-bolt/

That’s exactly my point. If you subtract 7,500 from the MSRP in that story, all the numbers go deep underwater. They can’t afford a $7500 dollar price cut.

Based on that story they would be building each car at $4K of losses without even factoring in overhead.

They aren’t a charity. Not only do they need to avoid $4K in losses, they need that 10% profit margin (~3K) too.

Frankly, the numbers from that article look like the $7500 incentive actually isn’t enough of an incentive to even come close to their ICE car profits once overhead is added back in.

Nix, I think you are right that GM makes less than $7500 on each Bolt sold, and a profit per unit (averaged over base and fully loaded Bolts) of $4,000 is not a bad guess. So the Bolt would have trouble with a $7500 price reduction in January of 2018. A $2,000 price reduction in February would leave them with a small but real profit. But if the credit goes away in October of 2018, GM could afford to drop the price per Bolt by $3,000 or even $4,000, while still making a 10% profit on each Bolt sold.
Flip side of the coin. Tesla S and X are making a decent profit per unit sold for Tesla, regardless of whether they are base or fully loaded. And both the Volt and the Leaf are going to continue to make GM and Nissan decent 15% profit per unit even if they have to drop the real world price by $3,000 or $4,000.
Losing the credit next year would mean the process would slow, but it would not kill the golden goose.

I think you are dead on the numbers and conclusion. +1

I hate having America slowed down, while China is completely on the gas.

how much profit for a full size pick up or suburban ??

the bolt is impressive for its range, but still not selling all that great….ev’s need to sell for the same price as their gas equivalent and be able to charge as fast as their gas equivalent , until then they will just be enthusiast vehicles…

Just great. I just ran the proposed tax plan on my current earnings. My federal tax goes up $3208. Every year. Yikes. I guess I’m doing my share in paying back the national debt.

The EV tax credit loss is peanuts to me.

Sadly, despite paying more in taxes, your share in the national debt will continue to go up even faster with this bill.

Instead of paying down the debt with your higher tax payments, this bill as written will increase the national debt by $1.5 Trillion dollars. The crazy part is that this is their intentional target. They are knowingly trying to pass a bill that will intentionally increase the national debt by $1.5 Trillion on purpose. This is on top of our current deficit spending, which had actually been gone down significantly from where it was in early 2009 to where it was by the end of 2016

Without the tax credit, I think the sales would slow down but momentum has been set that’s hard to erase.

What I do think will happen is that the road to cost parity with ICE vehicles will get delayed significantly due to reduced investment.

This will keep the focus on small cars and luxury cars and seriously slow down the electrification of the large volume/high profit segments (pick-ups, SUVs, Vans, mid-size cars) which enjoy huge economies of scale and can easily be lowered in price to prop up sales.

Just a point of clarification: This is wrong:

“General Motors has already used around three quarters of their allotted tax credits.”

GM doesn’t get any of the credit, other than an indirect way from leasing and increased end-user purchases. What has actually happened is that GM has sold over 150K cars that qualified for the tax credit, and the owners/leasing companies are the ones who actually get the use of the credit.

It’s not wrong at all. You’re trying to engage in a semantic (and therefore pointless) argument over the definition of the word “their”, as in “their” tax credits. Just because GM benefits only indirectly from those tax credits, rather than directly, does not alter the fact that it’s GM’s exclusive pool of tax credits, and once their pool is used up, it stair-steps down in stages until it disappears. At least that’s the current law; obviously things might change, which is the subject of this article.

20 evs on the horizon from GM. That’s a book made into a fair movie about a guy who gets lost in the Himalayas:
Lost Horizon:
https://www.youtube.com/watch?v=2zW6xGUpY7I

Shangri La, a fictitious place, nearby 20 new evs from GM will built.

I believe that GM will produce 20 EV’s in the near future. Oh, you mean 20 different models, not 20 of one type. Me bad.

I guess we’re going to see even more black Model 3’s with aero rims and rear wheel drive and smaller/base level batteries.

Whatever though, of course- as long as we see more than a million of them in the next 3-4 yrs on the roads they can all be black with aeros.

There is some lemonade that can be made from the loss of the credits. However, GM and Tesla notwithstanding, the credit has not yet served its intended consumer purpose for most major automakers. And it’s also important to understand why the credit was put in place in the first place, and now what is evident for American energy efficiency, independence, and global competiveness if EVs have a slowdown in the US. Here’s my editorial take on why the federal EV tax credit is still relevant, important, and needs to be preserved. https://www.linkedin.com/pulse/bill-repeals-electric-vehicle-tax-credit-wrong-turn-america-renburke/

Prius is a very slow vehicle. My 12 Volt easily passes them while they are using gas and I am not