Climate bill for ‘transformational’ auto and energy industries

“A large number of middle-class Americans will be able to get this credit that would otherwise be blocked because of the credit limit,” said Joe Britton, executive director of the Zero Emission Transportation Association, which includes Tesla as a member. Manufacturers of charging equipment, suppliers of battery materials and other companies related to the business of electric vehicles. “It’s a big deal.”

For the first time, used battery-powered vehicles will benefit from a tax credit of up to $4,000. This is important because most people buy used cars, not new. The average price of a new electric car is over $60,000, which is beyond the reach of many buyers, even considering the fuel and maintenance savings of these vehicles.

Individuals earning more than $150,000 a year or couples earning $300,000 or more will not qualify for the new electric vehicle incentive. The income limit for the used car incentive is $75,000 for individuals and $150,000 for couples. The credit does not apply to sedans that sell for more than $55,000 and vans, pickups and sport utility vehicles that list more than $80,000.

“They’re trying to drive adoption among middle- and lower-end buyers, and that’s good,” said Akshay Singh, a partner at accounting and consulting firm PwC that specializes in the auto industry. “That’s where the bulk of the market is.”

The bill, which runs to more than 700 pages, never mentions China. But several provisions appear designed to undermine that country’s grip on the electric vehicle supply chain while making it more difficult for future Chinese automakers to export vehicles to the United States.

As it stands, the 200,000-vehicle cap on tax credits would give a competitive advantage to market newcomers such as China’s BYD, which are expected to use electric vehicles to enter the US market. They could take advantage of the credit, while Tesla, a Texas-based company, could not.

Leave a Comment

Your email address will not be published.