Why would some members of Congress escape the $ 7,500 EV credit?

Republicans in the House of Representatives wish the removal of the tax credit of up to $ 7,500 on electric vehicles. Credit critics say it's a gift that disproportionately benefits the rich (somehow) because it's the one who buys electric vehicles compared to their numbers in the US population. Proponents of the tax credit say they support a nascent technology in the United States that could also cover long-haul trucks, electricity storage for large power plants offering high off-peak capacity, and the emergency power for individuals and businesses. Kill the credit and other countries will tackle the technology of electric vehicles and lithium-ion batteries.

Meanwhile, the tax credit is already disappearing on Tesla. The company sold 200,000 vehicles. Yesterday (Monday, October 15th) was the last day to order a Tesla and guarantee delivery before December 31st. This is the last day of the pre-elimination period in which a Tesla is still eligible for all of the $ 7,500 federal tax. credit.

Why do some Poles want credit to be discredited?

Current US legislation allows electric vehicle buyers to receive a tax credit equivalent to the money you pay, which is much better than a tax deduction of up to $ 7,500. You must pay taxes and owe $ 7,500 in taxes this year to get a credit of $ 7,500 this year. The credit aims to offset the higher price of a VE due mainly to huge lithium-ion batteries.

The Liberals are angry because the person who introduced the bill is US representative John Barrasso, a Wyoming Republican who is a friend of traditional fuel vehicles. There was an attempt to end the tax credit in 2017, which was linked to other legislation, and then removed. Barrasso's 2018 legislative proposal is an autonomous bill. The summary calls this:

A bill to amend the Internal Revenue Code of 1986 to remove the credit for new qualified electric traction motor vehicles and to provide for federal highway use charges for alternative fuel vehicles .

Several sources note that Wyoming is a state favorable to fracking and that Congressman Barrasso is well financed by oil interests. OpenSecrets.org reports that Barrasso in the 2017-2018 election cycle received $ 498,000 in oil and gas, 60% of which was political action committees. That's more than a dollar per person of voting age in the state's equal and largest pool of contributions.

More generally, detractors of electric vehicles and / or tax credit believe that the sector of electric vehicles should remain on the bottom, without subsidy.

It should be noted that electric vehicle buyers are highly concentrated in California and the west coast, followed by about 10 northeastern states. This is actually the largest of 20 states won by Hillary Clinton in 2016. They also contain most states with HOV (High Occupancy Vehicle) lines, which allow electric vehicles to use them as well cars with two or three vehicles. more occupants.

With Tesla Heading Out, there remains credit for consumer electric vehicles

Tesla is currently the manufacturer of the most expensive electric vehicles. A Tesla Model S crossover or sedan easily exceeds the $ 100,000 mark. Critics are therefore right to say that the Tesla tax credit benefits those who earn a lot. But these Tesla credits are endangered. From January to June, the credit falls to $ 3,500, then $ 1,875 in the next two quarters. This is for actual deliveries, not for orders, nor for the price paid in full for a vehicle that is still en route.

According to InsideEVs.com, car manufacturers are located from early September 2018:

1. Tesla, more than 244,000 sales of electric vehicles
2. General Motors, 193,000
3. Nissan, 125,000
4. Ford, 110,000
5. Toyota 89,000 (hybrid vehicles belonged to a different tax credit category)
6. BMW Group, 76,000

Each car manufacturer under an umbrella brand has a total of 200,000 units. These are electric vehicles and plug-in hybrids with large batteries. The 200,000 GM vehicles include Chevrolet, Cadillac, Buick and GMC. A separate, smaller tax credit exists for hybrid vehicles powered by battery power.

Tesla was smart in managing its deliveries and so reached the ceiling in early July. The phase-out phase is as follows: once you have made 200,000 deliveries, each vehicle delivered during this quarter receives the full credit, as well as each vehicle delivered in the next quarter. Thus, a builder can obtain credits from one quarter to one business day, up to two quarters less a day. GM will probably make 200,000 sales during this quarter (October to December), if not this month. It could therefore also benefit from stimulated deliveries.

Other automakers are starting to provide electric vehicles: Kia and Hyundai; and Volkswagen and Audi. Most are vehicles under $ 50,000.

California wants to increase its state credit

Wyoming has clean air. California has a cleaner air than it did 25 years ago, but 40 million people and regional pools trapping polluted air (Los Angeles) are challenging it. The federal government has long ago given California the right to establish stricter standards for the control of air pollution and has authorized other states to use the California standard, what many states in the Northeast have adopted. A bitter struggle is to check whether the federal government can withdraw what it has granted.

California is wondering whether the state should increase its own subsidy from $ 2,500 to $ 4,500. This is not only to continue, but to increase public demand for hybrid electric and hybrid vehicles. Last month, Mary Nichols, president of the California Air Resources Board (CARB), said she hoped the Congress increase the number of cars eligible for the federal credit. Otherwise, she told the Los Angeles TimesWe would have to look for another way to compensate for this. The Obama administration proposed, at the end of its mandate, to bring the electric vehicle credit from $ 7,500 to $ 10,000, but Congress has not made a decision. A credit of $ 10,000 would reduce the price of an electric entry vehicle to a minimum of $ 20,000 to $ 25,000.

The current 150-mile Nissan Leaf S in California, at a base price of $ 30,000, receiving federal and state credits, as well as $ 3,500 in premiums to Nissan (mid-October 2018), would cost $ 15,000 .

Car manufacturers, in general, want the US tax credit to be maintained or set at an upper limit. GM has rated EV credits as "significant customer profit". According to Nissan, the tax credit has led the company to make "significant investments" in EV technology. The Alliance of Automobile Manufacturers (GM, Toyota, BMW Group, Fiat Chrysler, Ford, Jaguar Land Rover, Mazda, Mercedes Benz, Mitsubishi Porsche, Toyota, Volkswagen, Volvo) accounts for more than three quarters of vehicle sales to the United States. -United. the elimination of credit will hinder the development of newer and more efficient electric vehicles. Tesla did not comment and no builder said killing the federal credit was a good idea.

Several European countries aspire to a future reserved for electric vehicles by 2050. Whether they are serious or they bluff the auto industry to see what they can accomplish, this will further stimulate research on electric vehicles and, if the US tax credit clears, may mean that R & D dollars are leaving the United States.

Read now: Tesla makes 200,000 sales: the countdown begins for lower tax credits, then none, Jaguar I-Pace 2019 Review: Tesla-Killer EV is the 2018's best car and Nissan's first 2018 sheet Leaf EV: 150 km, pilot assisted driving