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Tesla forms an unlikely partnership with GM and Nissan to preserve EV tax incentives

By Polycount · 13 replies
Nov 14, 2018
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  1. Tesla's success recently pushed them past 200,000 vehicles sold, but that comes with its own drawbacks. Specifically, the electric vehicle tax incentives it was able to offer its customers are being phased out slowly - beginning in 2019, the tax credit will be halved from $7,500 per vehicle to $3,750. In Q2 2019, it will be halved again to $1,875, and in 2020 it will disappear entirely.

    This is unfortunate news for would-be customers and Tesla itself - given the high cost of the company's cars, these tax credits were likely a pretty big selling point for many buyers. As such, it's in the company's best interest to keep them around as long as possible.

    Indeed, the desire to retain these sizable tax credits has resulted in Tesla entering into a bit of an unlikely partnership. According to Bloomberg, GM and Nissan have teamed up with the EV maker to launch the "EV Drive Coalition," a group of interested parties whose primary goal is to lift the cap on EV tax credits.

    "A federal tax credit to help make electric vehicles more affordable for all consumers is integral to reaching a zero emissions future and establishing the U.S. as the leader in electrification," GM's VP of public policy Dan Turton reportedly said in a statement. "We feel that the tax credit should be modified so all customers continue to receive the full benefit going forward."

    So, why are GM and Nissan, of all companies, banding together with Tesla on this? As Bloomberg notes, the former is expected to reach the 200,000 vehicle cutoff later this year, and Nissan has already shipped out 125,000 EVs of its own.

    The EV Drive Coalition is expected to approach Congress with a proposal laying out their desires in the future, but we don't have a specific timeframe for that just yet.

    Permalink to story.

  2. Theinsanegamer

    Theinsanegamer TS Evangelist Posts: 1,570   +1,787

    So tesla is STILL looking for government handouts after 15+ years? I thought the model 3 was good enough they didnt have to rely on the federal tax credit to boost sales.

    Ah well, some things never change.
    UaPro and senketsu like this.
  3. ShObiT

    ShObiT TS Maniac Posts: 183   +173

    Well, if the country is selling a Zero emission policy, this would be a step in maintaining that, BUT, that will be unfair competitiveness for GM and companies that rely in Petrol and basically help the country grow for like a century into what it is today.

    Maybe the Tax could be applied to higher cost Ev's like a $40,000 threshold in price.
  4. yRaz

    yRaz Nigerian Prince Posts: 2,935   +2,255

    I know it's popular to hate Tesla for whatever reason, but this isn't about Tesla just making money. Hate GM, too, for wanting to keep prices low in EVs. What about Toyota and Honda?

    EVs are prohibitively expensive even in the "entry" level market do to the high cost and lack of scale in manufacturing. Without the tax credits all manufacturers will have to reduce the scale of manufacturing and thus increase the price more on top of the lack of tax credits.

    But, you know, let's see how many likes we can get by making an uninformed slur post on Tesla
    Reehahs, iamcts, CrazyDave and 2 others like this.
  5. wiyosaya

    wiyosaya TS Evangelist Posts: 4,119   +2,406

    As I see it, it is the price of progress. Whether we like it or not, fossil fuel use is declining, and, IMO, the faster the better.

    Fossil fuel companies have known for some time now that the world's fossil fuel reserves are diminishing and they have also known that fossil fuels emit significant amounts of pollutants. Still, fossil fuel companies have struggled to maintain the use of fossil fuels rather than research alternatives and position themselves for their own survival in the future.

    I have made it well-known on TS that I am NOT a fan of Tesla; however, I am a fan of extending EV/PHEV/Hybrid tax credits. Such an extension will, as @yRaz pointed out, go to every manufacturer producing an eligible vehicle.

    If it were my decision, I would include a clause in such an extension that would stipulate that any such tax credits go only to manufacturers that are actively engaged in battery and or electrical storage (super capacitors and such) research.
    Reehahs and ShObiT like this.
  6. "A federal tax credit to help make electric vehicles more affordable for all consumers...……."
    instead of a Federal tax credit, how about every person making $100,000+ (at Tesla, GM, Nissan) in salary, bonus, pension, take a cut. Then it's more affordable to consumers and the consumer and especially the non-consumer isn't paying for the tax credit. Federal tax credits = tax money from everyone's pocket
  7. yRaz

    yRaz Nigerian Prince Posts: 2,935   +2,255

    Because the employees, who spend hundreds of thousands of dollars of their own money and years if of hard work to get those positions are entitled to make that money. Company policy should not impact the individual

    And I would like to boil down your statement for you as it sounds like something coming out of a 10 year olds mouth. You are talking about taxing the employees, not the general public.

    This is what it costs to produce these vehicles, the free market has demonstrated that. A tax incentive is required to reduce the cost of these vehicles across all income brackets. And I'd argue this tax incentive is more important for low income families if they put the cost of a new car in Honda Civic catagorc rather than the BMW 5 series category
    wiyosaya and Reehahs like this.
  8. Theinsanegamer

    Theinsanegamer TS Evangelist Posts: 1,570   +1,787

    Tesla has been making EVs for 15 years now. The model 3 was SUPPOSED to be the $35000 electric car your average joe could buy, yet that model is MIA.

    You seem to miss these companies are banding to gather to pressure congress to action, that most likely means increasing the number of tax breaks for electric car sales, AKA a government handout to these companies that, despite years of efforts, still cant make electric cars affordable, by your own admission.

    Multi-billion dollar corporations dont need any more government handouts, they get too many already. If electric cars are still too expensive for mainstream sales, continuing handouts even longer isnt going to fix the problem. If these companies cannot make electric cars affordable after so long, perhaps that technology is not suitable for the application it is being hamfisted into.
    senketsu likes this.
  9. I like how you keep calling it a handout.

    The tax break gets passed onto the consumer, not the company. There is a big difference here. A handout would be what congress just did in 2017 by giving corporations and the rich trillions in tax breaks.

    This is called an incentive.
    Reehahs likes this.
  10. thanks for that, you are so kind
  11. sorry, we fundamentally disagree. Tax incentives are NOT required and should be pretty near banned. How can you have a 'free market' and in the next sentence say tax incentives are required? And yes, my initial comment about wealthy executives is to point out that why are they allowed to take money out of taxpayer's pockets subsidizing their business, even if you don't buy from them, when they can afford to pay what are at times, obscene salaries. It wasn't an actual thing to do, I was just PO'd. If they can't make it, they should go out of business.
    You want to help low income people, stop taxing the bejeezus out of them.
  12. So what's the real cost of the Tesla? We've all been paying for them, regardless of whether or not we buy them? Doesn't sound like a good deal to me.
  13. wiyosaya

    wiyosaya TS Evangelist Posts: 4,119   +2,406

    What would be your solution, then?

    I'll remind you that there were electric cars before it was discovered that gasoline contains significant amounts of stored energy that can be released in a simple fashion. That discovery was also before the realization that burning gasoline is dirty and causes significant amounts of pollution where ever the density of burning gasoline/fossil fuels is high enough.

    Regardless of whether you agree with the politics of the area and the matter, there is an interesting set of photos that compare the Los Angeles area over time with respect to smog - https://www.kcet.org/shows/lost-la/las-smoggy-past-in-photos The source of smog is widely recognized as burning fossil fuels.

    Sure, things have improved WRT burning fossil fuels and the amount of pollutants they emit. Even so, fossil fuels are dangerous to harvest and produce significant amounts of pollutants in refining, transportation to market, and use where ever they are used. The average two-cycle leaf blower produces significantly more pollution than many gasoline burning vehicles. Here is an article about a test that Edmund's did - https://www.edmunds.com/car-reviews/features/emissions-test-car-vs-truck-vs-leaf-blower.html When accounting for the pollution of fossil fuels, many think only of the end-use/user. However, refinement, transportation, and harvesting is a large source of pollution.

    So what drove gasoline over electric then? Profits, and nothing else. To me, it seems that the choice lead to significant troubles for humanity - even though humanity managed to eke progress out of the choice. I can imagine that at the time, the same thing was said about EVs as you posited above.

    I can only imagine how advanced electric vehicles would be at this time if electric cars were not abandoned in favor of fossil fuels.

    As to electric storage, there have been significant recent advances and there is significant and promising laboratory research being done at this time; some, but not all, of that research will eventually make it to market.

    To me, because the technology is not quite what we would like it to be at present and is expensive at present is no reason to abandon it. As I see it, that would be akin to saying "humanity has learned everything it can possibly learn, so why should we pursue any further exploration or even discovery itself."
  14. mailpup

    mailpup TS Special Forces Posts: 7,412   +629

    Not to minimize the contribution of motor vehicles toward smog in Los Angeles but up until 1957 residents could and did burn household trash in backyard incinerators. There used to be a weekly ash pickup by the city. The smoke from those incinerators was considerable.

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