This sort of rank corruption should lead to trials, followed by hangings.
But it doesn’t.
Tesla will soon hit the limit of the federal tax rebates, which are good for the first 200,000 EVs sold in the US per manufacturer beginning in December 2009 (IRS explanation). In the second quarter after the manufacturer hits the limit, the subsidy gets cut in half, from $7,500 to $3,750; two quarters later, it gets cut to $1,875. Two quarters later, it goes to zero.
Given Tesla’s ambitious US sales forecast for its Model 3, it will hit the 200,000 vehicle limit in 2018, after which the phase-out begins. A year later, the subsidies are gone. Losing a $7,500 subsidy on a $35,000 car is a huge deal.
Tesla will sell near-zero cars without the subsidies. They know this. So does California, and guess where Tesla sells more cars than anywhere else?
What California is contemplating doing is subsidizing the difference in price between an EV and a car of “equivalent features” that is not an EV. This could wind up costing $30,000 per vehicle, and not as a tax credit either — as a direct rebate.
This post was published at Market-Ticker on 2017-07-25.
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