Tesla, Nissan, GM Join Hands To Lobby For U.S. EV Tax Credit Recharge

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NOV 19 2018 BY EVANNEX 29

TESLA JOINS GM AND NISSAN IN LOBBYING TO LIFT THE CAP ON THE FEDERAL EV TAX CREDIT

The $7,500 federal EV tax credit is probably not the most efficient way to encourage EV adoption – it mainly benefits higher-income taxpayers, and it doesn’t provide any incentive for auto dealers to get interested in selling plug-in vehicles. However, it’s better than no incentive at all, and there’s little doubt that it has encouraged a substantial number of EV purchases.

*This article comes to us courtesy of EVANNEX (which also makes aftermarket Tesla accessories). Authored by Charles Morris. The opinions expressed in these articles are not necessarily our own at InsideEVs.

From left to right: Nissan Leaf, Tesla Model 3, and Chevy Bolt (Image: Edmunds)

Legislators on both sides of the aisle support the tax credit – last year, Congress rejected an attempt to eliminate it. However, as with anything in politics, its future is uncertain. Recently, one Republican senator introduced a bill to expand the credit, and another introduced a bill to get rid of it and replace it with a tax on EVs. Now that Democrats have regained their majority in the House, the time could be ripe to reform and improve the policy.

The biggest problem with the existing credit program is that the credit is automatically phased out for individual automakers after they reach a threshold of 200,000 plug-in vehicle sales. This has the perverse effect of penalizing companies that took risks and got into the EV market earlier, and rewarding those who sat on the fence and waited to introduce their own plug-in vehicles.

The three automakers belonging to the former group, Tesla, Nissan and GM, have formed a coalition, together with several other EV-related organizations, including ABB, ChargePoint, Plug In America and Proterra, which advocates eliminating the sales cap and allowing all automakers to compete on a more equal basis.

Above: Companies involved in the collective effort to lift the cap on the federal EV tax credit (Image: EV Drive Coalition)

“The original electric vehicle tax credit, which goes directly to consumers, not manufacturers, catalyzed the market, increased consumer awareness and grew a nascent industry,” reads the manifesto of the newly formed EV Drive Coalition. “To promote continued market growth and stabilization, members of the EV Drive Coalition are advocating for reform to lift the current cap on the number of consumers who can take advantage of the credit through each manufacturer.”

“Arbitrary constraints with the federal credit limit consumer options and make it harder for consumers to purchase the cars they want,” says Joel Levin, Executive Director of Plug In America. “Lifting the cap would create a more level playing field for all manufacturers, giving consumers the freedom to decide which car they want in a free and fair market.”

“We feel that the tax credit should be modified so all customers continue to receive the full benefit going forward,” said Dan Turton, VP of Public Policy at GM.

Above: Efforts are being made to extend and/or update the Federal EV Tax Credit which currently has a phase-out schedule (Chart: EV Adoption)

“We’ve been able to make tremendous strides in the underlying technology of electric vehicles,” said coalition spokesperson Trevor Francis. “The battery power and the range have improved significantly over the last few years. With every new advance, we get closer to becoming an economically sustainable market. However, we’re not there yet, and keeping the cap will have a negative impact on a sustainable US electric vehicle market. As it stands now, electric vehicles are responsible for nearly 300,000 jobs. This is a jobs issue and an economic issue in addition to a consumer issue.”

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Written by: Charles Morris; This article originally appeared in Charged; Sources: EV Drive Coalition via Electrek

*Editor’s Note: EVANNEX, which also sells aftermarket gear for Teslas, has kindly allowed us to share some of its content with our readers, free of charge. Our thanks go out to EVANNEX. Check out the site here.

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29 Comments on "Tesla, Nissan, GM Join Hands To Lobby For U.S. EV Tax Credit Recharge"

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Nissan is going to have other things on their minds for a while
https://www bbc co uk/news/business-46259420

Carlos Ghosn has been arrested in Japan.

As in $44 million in understated income compensation over 5 years, type of arrested!

Renault SA shareholders today are stampeding for the exits as well ( -10% approx.)

He’s definitely out. Adios Carlos!

so many greedy ppl.

Under reported income, versus Audi keeping a CEO for a good month+ after arrest and implication in witness tampering over dieselgate.

He crossed the line. No excuse, but tax liabilities associated with ~40mn aren’t nearly the $$ damage we’re talking about, here.

It doesn’t look like Elon or Mary Barra will be able to “join hands” with Nissans Representative Director Carlos Goshen or Representative Director Greg Kelly anytime soon. They are taking the expressway towards the permanent exit at the RNM Alliance.

https://asia.nikkei.com/Business/Nissan-s-Ghosn-crisis/Nissan-s-Ghosn-arrested-for-alleged-financial-transgressions

https://asia.nikkei.com/Business/Companies/Nissan-s-statement-On-misconduct-by-Ghosn-and-one-representative-director

GM and Nissan are blowing smoke. EV’s are still not profitable for them and this is just PR.

EVs are profitable on their own, unless you insist on giving away small ones, or trying to define the market as something it’s not. Let me try narrating:
-Khashoggi doesn’t matter
-CO2 won’t hurt anybody
-$3/gallon is all that gasoline costs
-It’s the companies profit that should matter, not the consumer’s wallet.
-Price-making is ethical, price-taking is not

RE: alliance. I don’t think the EV tax-credit was ever socially, or socialist, in its intent. It was aimed at energy independence. Evannex is getting political, here. Batteries are expensive. Cutting someone buying a 5KWh PHEV a bigger break than someone ordering up 60-100KWh, thankfully, isn’t the way its supposed to work.

That’s exactly why they want the rebate to continue: a $7500 rebate give more flex on MSRP, and can be the difference between a profitable sale and an unprofitable one.

In reality this is a tax credit for the rich. A strong majority had the means, and would have purchased without the credit. I am sure the demographic on this website skews to higher income. Like it or not, about 45% of people do not pay federal income tax after normal deductions and credits. The next 10% pay less than $1,000 in Federal taxes, so they would only get $1,000 back from purchase price. I have not seen the numbers on the next levels. The Republicans that are willing to vote for the extension, will want it to stay the same structure favoring the higher income tax payers. Fiscal Republicans will want to eliminate it altogether. The Democrats for the elite will favor extension as is, and the Democrats for the lower wage workers will view it as a tax credit for the rich and not go along. Just what it is.

oh please. This is NOT a tax credit for the rich. It is about our nation.
However, it is being done wrong. Get rid of the credit and raise fuel tax over a long period of time.

Yes, yes, most Americans are wealthier than 95% of the world. Thank you, we know. Poor people typically can’t buy new cars, did you know that? That was Obama’s Cash for Clunkers program. The EV Tax Credit program is about stimulating product development and consumer adoption. You can’t do that if all you care about is a hand-out to the poor. There are smarter things to do for the poor than give them money at every turn. I mean, what really is your plan, dole out EVs to people making $20 /hr or less?

Here is my suggestion: adopt California’s ZEV requirement at the national level, make the credits non-transferrable, and if a company falls short, they get a fine equivalent to whatever the credits were worth in the CARB program, by the amount they are down. Then, with the revenue from fines, fund whatever Publisher’s Clearing House EV sweepstakes program suits you, continually. Raise the bar every 3 years by 3%, until it concludes at full EV adoption. Oh, and leave room for the FCEVs, but don’t overrate them.

+1 “Poor people typically can’t buy new cars”
Average new car buyer age = 51. That’s it! We need to give more new cars away. Justice! /s

Then again, poor is relative. I’ll never forget the guy who was from Michigan and was making $40k a year, bought himself a Tesla after a divorce. Previous car was a Camry.
If there’s one thing making every lower income earner in America poor, it is renting. If there’s two, it’s the telecommunications companies and other discretionary spending habits we are convinced we need. A $0.35 can of soda is $3.50 at a restaurant.

If you don’t make a lot of income, go to your local bank or credit union and ask if they offer a budget/personal finances class. If they don’t, as them to. Banks win when their customers have more money. They hate foreclosing (they frequently lose money), repossessing, and want happy, successful customers.

To your point, I see a ton of folks in the local Tesla club who buy a new car every 3-5 years and trade in. Hey, that’s fine and all, but you’re skewing the average buyer age statistics! Still, younger Americans are not buying new cars.

If the credits were non-transferable, Tesla wouldn’t exist today.
Let’s not pull up the ladder behind them.

More right-wing talking points by the serial anti-EV and especially anti-Tesla troll “Independent…”.

He is probably another shill for Big Oil and being paid to spread FUD disinformation.

Not sure if he’s right wing, but isn’t it interesting those right wingers who talk about small government and low taxes magically turn into socialist left of Bernie Sanders when it comes to EV and people getting their money back?

And same with left wingers who wish to confiscate more tax to give to Donald trUMP become right of Reagan when it comes to EV.

I know… so of the most hypocritical arguments are brought up by some elephants when talking the green energy tax credits.

“In reality this is a tax credit for the rich”

Question: How much do you have to make to qualify for full federal tax credit?

Answer: About $50K/yr, about average income of US.

I suppose you’re technically correct since that level of income is more than the average. But in reality (your words), no one would say $50k/yr income is rich.

Question: How much do you have to make to qualify for full federal tax credit?
Answer: Zero dollars.

Anybody can lease an EV and get the federal tax credit passed onto them, or buy a used EV and have the incentive pass through to them from the original buyer.

“In reality this is a tax credit for the rich.”

You mean like the people who leased Fiat 500e’s for less than $100/month?
https://insideevs.com/cheaper-lease-fiat-500e-smartphone/

Your entire argument relies upon you being intentionally blind to the fact that people don’t need ANY taxable income at all if they lease the car and get the fed tax incentive passed on through the lease company.

Not to mention that for most EV’s, the tax incentive is effectively being passed on to the second buyers in used EV sales, because the incentive pushes down the used prices. So if you are super bvtt-hvrt about it, go buy a used EV from some rich folks and get the incentive passed on to you and stop whining.

Hey! Are you certain of this (“get the fed tax incentive passed on through the lease company”)?

I’m currently STRONGLY considering leasing a new Hyundai here in California (I like its efficiency, price, and the lifetime–original owner–battery warranty), and need to know how to propose this possibility to the dealer (particularly with Trump’s now larger standard deductions, we CANNOT deduct any 7.5K)

So the company offering the lease would take that tax credit and pass the savings on to me in the form, presumably, of lower monthly payments? I’m assuming that the residual value at the 3-year term end would remain the same ($15k, about 50% MSRP), correct?

How might this work, please?

Thanks a lot for an interesting discussion here!

Do Not Read Between The Lines

No.

No, kill the credit. We should all be pushing for killing this credit.
INSTEAD, we should be pushing for the infrastructure to be fixed.
Since it has been forever (30+ years) since gas/diesel taxes have gone up, we need to raise those.
BUT, these need to go up slowly to avoid hitting the economy (and give ppl time to adjust).
We should raise gas/diesel by .01 / gal EACH MONTH for 50-100 months (i.e. add $.50-1.0 to a gal of fuel).
The gas portion should be given to the state, and the diesel should go to the feds.
In addition, it should ONLY be used for infrastructure.

And to keep the ICE ppl from screaming too loudly, kill the credits, and then ideally have states tax none-commercial EVs by adding say $150 to the yearly license bill. That should be applied to both EVs and Hybrids.
As to commercial, charge by the mile, which is done monthly by the operator.

Why don’t you spend $7.5K of your money to fix your local infrastructure (ie, pot holes)? That will be lot more efficient than having some bureaucrat take some off the top before fixing. No one’s stopping you from doing so.

While you’re at it, write a check made out to Donald trUMP equivalent increase in gas price you want to pay. Practice what you preach before telling other people.

so, another ICE guy that refuses to pay for what they are using. Why am I not surprised?

Usually, discussions of subsidies of EVs devolve into generic attacks on government subsidies. For the 1000th time, let’s remember the US government subsidizes the oil and gas industry somewhere between 5 and $50 billion dollars EVERY year, and has done it for decades (depending on how you want to measure it. 20 billion is probably a safe bet). And, public policy has not yet reflected the cost of carbon emissions. California fires anyone? Or maybe all we need to do is rake our forests, like Finland? https://www.nrdc.org/experts/danielle-droitsch/time-us-end-fossil-fuel-subsidies

HAHA! Although the last 2 big fires can be laid at PG&E’s feet, governor Moonbeam just passed the law that forces PG&E subscribers to fully pay the cost of all future lawsuits and wrongful deaths associated with their boondoggle fires.

Yes there is partial blame for too much brush and undergrowth – if they had reclaimed some of that there would still be some bio-fuel plants that wouldn’t have shutdown. But I’m just talking about the primary idiocy. Not that the people responsible are dumb – but I’m unconvinced about the intelligence of those who keep letting them get away with it.