- Timothy Artman/Tesla
- The GOP tax bill would eliminate a $7,500 tax credit for electric vehicles. Some consumers rely on the incentive to afford electric cars, which are still more expensive than gas-powered vehicles because of battery costs. Automakers like General Motors are fighting to preserve the tax break.
Adam Bink, a 33-year-old resident of Sonoma, California, ordered a Tesla Model 3 when Tesla CEO Elon Musk unveiled the electric sedan in March 2016. He’s expecting to get the car next spring – a delayed delivery date because of Tesla’s production struggles.
But if Congress passes House Republicans’ massive tax bill as written, it won’t matter whether Bink will get his car a few months late. He says he would have to cancel his order. That’s because the healthcare bill, which the GOP hopes will become law as soon as Christmas, would eliminate a $7,500 tax credit for electric vehicles.
“It just puts it out of reach financially,” Bink said in an interview. “I have to think that a lot of people who placed reservations for this car are in the same boat where they did the math and said, ‘This helps me out and makes it a more reasonable budget.'”
Bink’s financial situation highlights the role the tax break has played in helping drive electric-vehicle adoption. Though battery prices are poised to fall, their cost makes electric vehicles more expensive than most gas-powered cars on the market today.
With automakers beginning to invest heavily in electric vehicles, industry leaders have spoken out against the potential elimination of the tax break.
“There is no question that the potential elimination or phase out of the electric vehicle tax credit will impact the choices of prospective buyers and make it more challenging for manufacturers to comply with electric vehicle mandates in 10 states,” the Alliance of Automobile Manufacturers said in a statement. The group represents 12 major automakers, including Ford, Mercedes-Benz, and Volkswagen Group of America.
A General Motors representative said the company would work with Congress to maintain the incentive.
“Tax credits are an important customer benefit that can help accelerate the acceptance of electric vehicles,” the person wrote in an email. “Because General Motors believes in an all-electric future, we will work with Congress to explore ways to maintain this incentive.”
A Volkswagen representative said its government affairs team sent a message to Congress, calling for them to oppose the incentive’s removal. “Eliminating the EV tax credit would hurt the environment, hurt jobs, and hamper progress being made to reduce carbon emissions,” the letter said in part.
A Nissan representative said the company generally supported measures encouraging consumers to buy electric cars.
“Nissan has made significant investments in the development of market-leading electric vehicles and public charging infrastructure to support EV drivers,” the Nissan representative wrote in an email. “We support continuing measures that help encourage greater adoption of EVs given the benefits they can provide such as lowering vehicle emissions and reducing America’s dependency on foreign energy sources.”
A Ford representative deferred comment to the Alliance of Automobile Manufacturers, adding that its “focus is on the overall tax reform package and how it helps support American manufacturing.”
A Tesla representative declined to comment. Representatives for Hyundai and Kia didn’t return requests for comment.
Republicans plan to put the bill to a vote in the House next week, according to Reuters.