The US Senate is now discussing the Build Back Better Act, which includes a much-needed reform of the federal EV incentive. Tesla fans are furious about the $4,500 additional incentive for electric cars made by unions.
They see it as one more attack by the Biden administration on Tesla, but they should reframe the issue to highlight the fundamental problem with the new policy.
The reform to the federal electric vehicle incentive program, which includes an increased $12,500 EV incentive, has survived President Biden’s updated ‘Build Back Better’ proposal.
States, cities, and utilities from coast to coast are expanding programs to encourage EV adoption and new charging infrastructure. The pause in driving and pollution during the pandemic is urging authorities to promote electric cars. These local efforts come as the federal government weakens emissions standards.
Earlier this year, Germany announced its first electric vehicle incentive program to spur adoption of green vehicles in the country. Financed by both the state and the local auto industry, the program offers a €4,000 discount at the purchase of an all-electric vehicle and €3,000 for a plug-in hybrid.
The program is capped to electric vehicles with a starting price of less than €60,000, which prompt Tesla to respond and claim that it was purposely left out by the auto industry since its vehicles start at over €60,000. While the program is not helping Tesla, it is certainly helping BMW as reports are coming out claiming that sales of the BMW i3 are somewhat unsurprisingly significantly rising in Germany since the launch of the program earlier this month. Expand Expanding Close
Colorado official passed its bill HB 1332 to update its electric vehicle incentive program. The legislation now gives electric vehicle buyers in Colorado a $5,000 tax credit which can be immediately realized at purchase through a dealer incentive.
It’s a significant improvement over the state’s previous program, which was already generous, but nowhere near as straightforward and efficient as it is now. Expand Expanding Close
Fast-forward to this week, Tesla is now claiming that the government and German automakers purposely included this base price restriction to exclude Tesla from the program. In its official response on its German website, Tesla writes:
“[the plan] was drawn up jointly with the Chairman of the German automobile manufacturers and the relevant ministries.
Unfortunately, it was decided that Model S and Model X customers wouldn’t benefit from this promotion, because what they call ‘premium’ is linked to an arbitrary price limit. This part of the program is obviously directed against Tesla.”
Tesla is right about the EV plan having been negotiated with German auto industry. Even German Chancellor Merkel was directly involved in the negotiations with executives from BMW, Mercedes-maker Daimler and Volkswagen. Expand Expanding Close
Next week, the California Air Resources Board (ARB) will hold a public workshop on the FY 2016-17 Funding Plan for Low Carbon Transportation and Fuels Investments and AQIP. Under the current proposal, the Clean Vehicle Rebate Project (CVRP) would receive $230 million in funding through 2017. Expand Expanding Close
We’ve heard some discussion in EV industry about the implications of GM advertising the Bolt’s pricing as “$30,000 after incentives” and in contrast, Tesla is talking about the Model 3’s starting price as being “$35,000 before incentives”. Expand Expanding Close
Quebec government announced today its new plan to accelerate the electrification of transport in the province. The Liberal government says it plans to spend $420 million in the next 5 year. The program is less generous than the previous government’s plan lead by the Parti Québécois who announced a $516 million program before being ousted during the 2014 election. Expand Expanding Close
