Climate change bill ‘transformative’ for auto and energy industries

“A lot of middle-class Americans will be able to get this credit that otherwise would have been blocked because of the credit limit,” said Joe Britton, executive director of the Zero Emission Transportation Association, whose members include Tesla. as well as manufacturers of charging equipment, suppliers of battery materials and other companies related to the electric vehicle sector. “It’s a big problem.”

For the first time, used battery-powered cars would receive a tax break of up to $4,000. This is important because most people buy used cars, not new ones. The average price of a new electric car has topped $60,000, out of reach for many buyers despite the fuel and maintenance savings these vehicles provide.

Individuals earning more than $150,000 a year or couples earning $300,000 or more would not qualify for new electric car incentives. Income limits for the used car incentive are $75,000 for individuals and $150,000 for couples. The credits would not apply to sedans that sell for more than $55,000 and vans, pickups and sport utility vehicles listed for more than $80,000.

“They’re trying to drive adoption among middle-class and lower-class buyers, and that’s a good thing,” said Akshay Singh, a partner at accounting and advisory firm PwC, which specializes in lending. ‘automobile industry. “That’s where most of the market is.”

The bill, over 700 pages, never mentions China. But several provisions appear designed to undermine that country’s grip on the electric vehicle supply chain while making it harder for emerging Chinese automakers to export cars to the United States.

As it stands, the 200,000-vehicle cap on tax credits would provide a competitive advantage to new market entrants like China’s BYD that would need to use electric vehicles to enter the US market. They could have taken advantage of the credit while Tesla, the Texas-based company, could not.

About Catherine Sturm

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