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⚡ This Week’s Big Charge
💡 EV Tax Credit Phase-Out: A Strategic Inflection Point for Mobility
Given Route Zero’s audience, I don’t need to remind you that this is the last car-shopping weekend to secure the $7,500 electric-vehicle tax credit. (At least, I really hope this isn’t news to you!)
Whether you saw it coming or not, October marks the end of a Biden-era policy aimed at putting more Americans behind the wheel of electric cars. It worked: about 1.3 million new EVs were bought or leased last year.
While it’s hard to say how many of those sales were driven by tax credits or hefty manufacturer discounts, both were certainly major factors. And with people rushing to take advantage of some very aggressive clearance deals, the third quarter of this year will probably represent some other record.
So what happens next? Well, I haven’t spoken to any serious person in the industry who truly believes EVs are going away—here in America or anywhere else. That may be the hope of some, but the electric mobility industry is here to stay.
As I wrote in July, I remain optimistic for the field long-term. Here are some thoughts about what’s happened since, and what’s next.
How will the end of EV tax credits impact your company? We want to hear from you.
I want to hear your thoughts, theories and plans for this next phase of electric mobility. Drop me a line; I’m happy to keep it anonymous. [email protected].
💀 The EV Tax Credit Post Mortem
Admit it: The tax credits were always a bit of a mess. The restrictions were onerous, centered around the origin of the car, its battery and its critical mineral components—essentially had to be sourced in North America.
Fewer than 20 cars qualified for the tax credit at purchase. Nearly all of those were made by General Motors, Hyundai Motor Group or Tesla.
The credit did apply to all EVs that were leased. That’s why so many were, and often at outrageously discounted prices that weren’t remotely profitable for their makers. That never felt sustainable.
But they appealed to many Americans eager for a good deal on a new car, especially those already stretched thin in other parts of their finances. And who can blame them?
The deck had been stacked against EV adoption for a while. Anti-electric propaganda, the partisan bias against clean energy, resistant car dealers and other factors made the type of “fuel” a car runs on rather political and cultural, when it didn’t need to be.