Potential future EV credit changes [NO POLITICS]

ShirBlackspots

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Information cross posted from:

Tonight 645 pages of tax legislation dropped that is a first draft of language to be included in the reconciliation bill that the Democrats are trying to pass later this year. Of course, all of this is subject to change, but highlights from my skimming are below:

New EV credit that is the sum of:
  • $4,000 base amount
  • $3,500 if the EV has a battery of at least 40kWh
  • $4,500 if the final assembly occurs at a domestic, unionized plant
  • $500 if at least 50% of components and battery cells are manufactured in the US.
The credit is now refundable, and can be remitted to the dealer at the point of sale. The credit also has an income limit, but only phases out above incomes of $400,000 Single/$800,000 MFJ. There are also new MSRP restrictions, so any EV above the following MSRP's is ineligible for a credit:
  • $55,000 for a sedan
  • $64,000 for a van
  • $69,000 for an SUV
  • $74,000 for a pickup
There would also be a new credit for used EV's of up to $2,500. The sale price of the used EV would have to be less than $25,000, and would phase out for buyers over $75,000 Single/$150,000 MFJ.

It looks like this would all take effect in 2022, and replace the existing credits. Here is the link in case anyone wants to read and discuss (starts on p. 282): https://waysandmeans.house.gov/site...ans.house.gov/files/documents/SUBFGHJ_xml.pdf
If the tax credit is stackable, like i think it might be, that means $12,500.

If my stocks grow like I want them to, plus if I can save $12,000 in the next two years and 4 months and the combined $12,500 tax credit, I could afford the F-150 Lightning with the extended range battery, max tow and 9.6kW Pro Power, and tailgate step. + TTL (about $67,000). I would only have to finance around $24,500 to $30,000.
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ShirBlackspots

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There is also this, too:

From the article linked:
For five years, the legislation would implement $7,500 point-of-sale consumer rebates for electric vehicles and pay out an additional $4,500 for vehicles assembled in a union facility. Another $500 would be awarded for vehicles using a battery manufactured in the U.S.
 

greenne

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Information cross posted from:



If the tax credit is stackable, like i think it might be, that means $12,500.

If my stocks grow like I want them to, plus if I can save $12,000 in the next two years and 4 months and the combined $12,500 tax credit, I could afford the F-150 Lightning with the extended range battery, max tow and 9.6kW Pro Power, and tailgate step. + TTL (about $67,000). I would only have to finance around $24,500 to $30,000.
So.....*IF* (big if) this were to get passed, wonder if Ford will adjust the MSRPs any to try to get as many just under the line. I'm looking at a Lariat+, MSRP est. $79k based on leaked info earlier this year. Wonder if Ford will try to sneak that one just under $74k. I don't think Ford can afford to lower the Platinum by $15k, but may be able to swing ~$5k.

Of course all this is subject to change and adjusted up/down a bit..

I also wonder if this is why Ford has been very mum on pricing details so far, so they could adjust slightly to maximize sales.
 
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Sun Devil

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Wonder if Ford will try to sneak that one just under $74k. I don't think Ford can afford to lower the Platinum by $15k, but may be able to swing ~$5k.

Of course all this is subject to change and adjusted up/down a bit....
I'm in the same boat. Leaning towards the Lariat Premium package which would exceed the threshold.

It is nice that the proposal is a point of sale discount. That is the biggest issue with the current structure - you must have the ability to use the full tax credit to enjoy the benefit. It will be interesting to see what shape, if any, this new legislation takes.
 

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This is such a scummy update to the credit amounts.

$4500 completely tied to unions but ZERO for non-union US assembly?

The old $2500 for US assembly and $2500 for union was still questionable, but this is ridiculous.

So, a foreign company building an EV in a foreign country would get just $500 less credit than Tesla, a US company building cars in the US, with the Model 3 being the “most American car” according to a recent study? But unions get $4500 extra?

Works great for Lightning buyers, but this is trash.
 

bboy_72

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This is such a scummy update to the credit amounts.

$4500 completely tied to unions but ZERO for non-union US assembly?

The old $2500 for US assembly and $2500 for union was still questionable, but this is ridiculous.

So, a foreign company building an EV in a foreign country would get just $500 less credit than Tesla, a US company building cars in the US, with the Model 3 being the “most American car” according to a recent study? But unions get $4500 extra?

Works great for Lightning buyers, but this is trash.
This is incorrect.
 

SteffanG

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This is such a scummy update to the credit amounts.

$4500 completely tied to unions but ZERO for non-union US assembly?

The old $2500 for US assembly and $2500 for union was still questionable, but this is ridiculous.

So, a foreign company building an EV in a foreign country would get just $500 less credit than Tesla, a US company building cars in the US, with the Model 3 being the “most American car” according to a recent study? But unions get $4500 extra?

Works great for Lightning buyers, but this is trash.
I wish we got something even remotely as good in Canada. We get $0 on any of the trucks as if I'm not mistaken the cutoff is somewhere around $50k here (the XLT starts at $68k).

The union thing may be their way of not subsidizing Tesla as much since they have already gotten a ton of credits - every other US manufacture is union.
 
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ShirBlackspots

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This is incorrect.
If it US built - non union with 50% us built battery, it looks like the credit is $8000.
A union, US built EV is that $8000 PLUS $4500 for $12,500

The nice part of this proposed credit is that it can be used at the point of sale.
 

Blainestang

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This is incorrect.
What’s incorrect? My opinion or the actual info?

The only questionable info is perhaps saying it’s “zero” for US production. One place says $500 for US *battery*. One says $500 for 50% components and battery.

Either way, US union labor gives a $4500 advantage over US non-union labor, and both can get the $500.
 

bboy_72

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What’s incorrect? My opinion or the actual info?

The only questionable info is perhaps saying it’s “zero” for US production. One place says $500 for US *battery*. One says $500 for 50% components and battery.

Either way, US union labor gives a $4500 advantage over US non-union labor, and both can get the $500.
Your anti-auto union sentiment, of course.
 

Blainestang

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I wish we got something even remotely as good in Canada. We get $0 on any of the trucks as if I'm not mistaken the cutoff is somewhere around $50k here (the XLT starts at $68k).

The union thing may be their way of not subsidizing Tesla as much since they have already gotten a ton of credits - every other US manufacture is union.
Yeah, the overall amount is definitely generous.

Tesla has gotten a ton of credits because they’ve sold tons more EVs than anyone else, which is *supposedly* the point.

That said, GM used all their credits, too.

If union workers get paid more, ok, maybe they’re trying to level the playing field a bit, but $4500 per car? Are union workers paid $4500 *per car* better than non-union? That seems outrageous.
 

Blainestang

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Your anti-auto union sentiment, of course.
Got it, so not “incorrect” since the data was accurate and I didn’t actually say anything that was anti-union.

I suggested the difference between union and non-union (but still US) was too high, and if the goal is supporting US workers, then the difference between US non-union vs foreign assembly is too low.

Unions can absolutely be good, but $4500 seems like a huge number not actually based on the reality of how much more union members get paid vs non-union per vehicle, but just a chance to legislate money to the big 3 and unions at the expense of taxpayers and other US auto workers.

It’s not that I think unions are inherently bad, it’s that I question the $4500 (more than a 50% increase to the total credit) given to certain companies and US workers instead of other Us companies and US workers that get $0, same as a foreign company would.

If instead of $4500 it was $100,000, would it be “anti-union sentiment” to suggest that’s a ridiculous amount? No, questioning the value of a tax credit, especially a big one that chooses some US workers over other US workers is not inherently “anti-union sentiment”.
 

Pioneer74

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Got it, so not “incorrect” since the data was accurate and I didn’t actually say anything that was anti-union.

I suggested the difference between union and non-union (but still US) was too high, and if the goal is supporting US workers, then the difference between US non-union vs foreign assembly is too low.

Unions can absolutely be good, but $4500 seems like a huge number not actually based on the reality of how much more union members get paid vs non-union per vehicle, but just a chance to legislate money to the big 3 and unions at the expense of taxpayers and other US auto workers.

It’s not that I think unions are inherently bad, it’s that I question the $4500 (more than a 50% increase to the total credit) given to certain companies and US workers instead of other Us companies and US workers that get $0, same as a foreign company would.
Most non-Union car companies pay close to the same amount per hour to their employees. It's one of the ways they keep the Union out of their factories.

The amounts for Union and non-Union have absolutely nothing to do with the amount of money spent on labor to assemble the vehicle. It's Democrats pandering to their base.
 
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