General Motors is the latest carmaker to lose its full $7,500 federal EV tax credit. Well, at least half of it.
Beginning April 1, 2019, buyers of General Motors’ Chevrolet Bolt EV, Cadillac CT6 plug-in hybrid and remaining Chevy Volt models will no longer be able to claim the full the Obama-era ‘Plug-In Electric Drive Vehicle Credit’ of $7,500.
On that date, the credit will drop to $3,750 for applicable GM-built EVs. On October 1, 2019, it will be slashed once again to $1,875, and totally phased out in 2020.
Under the IRS rules, the federal tax credits are fully phased out five quarters after an automaker sells more than 200,000 EVs. GM Hit that threshold in late 2018, according to CBS News.
Tesla was the first to hit the tax credit limit, when it sold its 200,000th EV last summer. The competitive price point of the brand’s entry-level Model 3 was hinged on that credit. So Tesla slashed $2,000 off the price tag to offset the loss of the tax incentive.
Incentive or otherwise, GM is keen to produce more EVs … a lot more. The automaker announced last year that it will produce as many as 20 new electric vehicles. Though, some of those will be e-Bikes, like the ones revealed in late winter.
Will GM EVs remain competitive without the credit? The General is moving forward as if they will.
Last week, GM revealed that it will build a second EV based upon the Bolt EV at its Orion Assembly Plant. The expanded EV line will require the brand to invest $300 million into the facility and add 400 new jobs.