Earning a lot? Some States will now Kill your Plugin Rebate

Perhaps Tesla will look for somewhere else to build the Model 3.

I like the idea of higher rebates for lower income people, but cutting off the well to do isn't exactly going to save much once you factor in how much more they pay on income taxes, and the higher sales tax on the Model S.

 

With all of the push to have higher income folks shoulder even more of the tax burden, not to mention fewer deductions and all, does it make sense to offer cash tax credits for a purchase? Now those pushing for plug-ins and all would say Yes! I would respond that if it was important enough to increase their marginal rates some 5% or so, that it hardly makes sense to offer tax credits.

 

The part about fuel cell rebate still applying makes this comical. This is not really about the revenue of the state or individual. It is about the revenue of corporations.

 

True, it's a subsidized program for them. Taxpayers subsidize those that buy one, and in turn, car companies get to sell what wouldn't be palatable otherwise. It would make people mad if they just gave a check to the companies directly.

 

I am "liking" the post not because I like the idea of it, but I like the fact that Hill has updated us on this important matter. I try to keep PiP incentives matters updated in the Incentives sticky, but there has not been much to write home about with the limited availability of PiP.

As far as the concept of the Bill, mixed feelings. Takes me by surprise, did not know it was coming.

This year GA and WA I believe ended their BEV credits. OR is thinking of adding BEV incentive.

 

Label me cynical, but this is just CARB playing politics against the tesla and for fcv.

First they tried to eliminate expensive cars ($50,000) but fcv price was over that, and instead of raising it to what fuel cell lobby chose for a starting point for their vehicle they pulled it, and went with this.

Pretty damn cynical. But hey its hard not to be when the fuel cell rules came out of CARB when their chairman worked for the fuel cell lobby.

1) Is it good policy? No not at all, but that shouldn't matter. This is politics plain and simple. California needs to subsidize fuel cells more, because poor people in apartments really really want fuel cells. Unfortunately with $3 gas CARB can't find many poor people to pretend they want a fuel cell and deserve money for it.
2) Will it hurt tesla sales as intended? That is doubtful those earning over in california $250,000 will decide against a tesla because it has a $7500 tax credit instaed of a $10,000 one. Tesla sells most of its cars outside California anyway. t may decrease the volume of leaf, volt, prius phvs that are more price sensitive.
3)Will it help fcv. I doubt it. It more than likely will just piss off alternative fuel adopters from the favortism.

 

A LOT more of these maneuvers need to be formulated to make FCVs the only desirable "clean air" vehicle technology in CA. Obviously the EV is now the supreme enemy of CARB (aka CA legislature and executive branch).

 

Cutting off incentives based on income is a dumb move IMO.

 

Call me cynical but I don't think I should've gotten a rebate or credit on my PiP. I'm not an idiot, I took the rebate. However, the $4000 does not change the affordability of the car for me. It may if I earned less. I am all in favor of this bill. In fact, I make way under $250k so I will still be able to take the rebate even though I don't need it. However, I do not like making hydrogen an exception. If the intent is the same, a high income household will not need the rebate for either vehicle types.

 

The FCV rebate may make sense to encourage early adoption of a new possible but risky technology, EV and hybrid are proven.

And as for having lower/no rebates for a family making $500k taxable, in NC the median family income is $46k. In CA it was $60k in 2013.

 

For what purpose? There are a lot of possible and risky technologies other than a FCV. What should be the basis for routing taxpayer money to specific technology undertakings of some corporations?

 

I don't follow your logic here. The bigger credits and cash were originally set up because the fuel cell lobby said plug-ins woulding work, but people would buy fuel cells. Now the credits and rebates should be higher because its riskier. Sounds like an excuse.

FCv credits apply no matter what the income is, but it is cut off for plug-ins.

The previous proposal was no credits if the cars were over $50,000, but when it was found the fcv would be priced higher that was pulled.

Hey I'm all for means testing, but in california that would be the interest deduction. Here this was targetted against teslas so that the fcv/tesla mix would look better. I don't think it will work, but there is no real 'splaining how this cleans the air in california or helps the middle class.

 

The lion's share of a consumer subsidy usually flows to the manufacturer through a higher price to the consumer, so the actual effect of cutting off the subsidy to high income households remains to be seen.

 

Not opposed to subsidies for any new technology that is ready to market. Test lab stuff isn't ready to be tried in the real world of varying customers, conditions, etc like the FCV is. I also have no problem with reducing or eliminating the subsidy for more proven technologies that can sink or swim on their own merits but which might not have been introduced absent the initial subsidy.

Producing 500 or even 5,000 of something has enormous costs per vehicle that 100,000 unit products have more units to absorb. (Said as a former product manager for a 200 unit per year product. The overhead/investment/support was 10x the actual production costs.)

When you develop or decide to productize, you are always weighing risk/cost versus reward. The subsidy helps on the risk/cost side of the argument.

Would any of the alternative or dual fuel vehicles have been produced without initial subsidization?

 

I'm not questioning that subsidies help. Rather the question is why should taxpayers help them when there is no payoff for the taxpayer.

 

I don't believe that is happening in the auto industry.

In NJ EVs are exempt from the 7% sales tax. Is Tesla's price 7% higher in NJ? No. Are Nissan's dealers trying to sell LEAFs for 7% more than in PA? No.

When Toyota's hybrid tax credits expired did Toyota cut Prius prices? No.

There has to be uncounted thousands of subsidies written into the tax code and I believe everyone benefits from one or another. It's all about politics. Always has been. Always will.

 

Apples and Oranges

 

what about gasoline subsidies? no income verification required.