Tesla forms an unlikely partnership with GM and Nissan to preserve EV tax incentives
The companies have launched the 'EV Drive Coalition'By Cohen Coberly 13 comments
In brief: Although Tesla's electric vehicle tax credits are set to disappear in the coming years due to the company recently surpassing 200,000 EVs sold, it isn't letting the incentives go without a fight. Tesla today formed an unlikely partnership with GM and Nissan to convince Congress to extend the credits as much as possible.
Tesla's success recently pushed them past 200,000 vehicles sold, but that comes with its own drawbacks. Specifically, the electric vehicle tax incentives it was able to offer its customers are being phased out slowly - beginning in 2019, the tax credit will be halved from $7,500 per vehicle to $3,750. In Q2 2019, it will be halved again to $1,875, and in 2020 it will disappear entirely.
This is unfortunate news for would-be customers and Tesla itself - given the high cost of the company's cars, these tax credits were likely a pretty big selling point for many buyers. As such, it's in the company's best interest to keep them around as long as possible.
Indeed, the desire to retain these sizable tax credits has resulted in Tesla entering into a bit of an unlikely partnership. According to Bloomberg, GM and Nissan have teamed up with the EV maker to launch the "EV Drive Coalition," a group of interested parties whose primary goal is to lift the cap on EV tax credits.
"A federal tax credit to help make electric vehicles more affordable for all consumers is integral to reaching a zero emissions future and establishing the U.S. as the leader in electrification," GM's VP of public policy Dan Turton reportedly said in a statement. "We feel that the tax credit should be modified so all customers continue to receive the full benefit going forward."
So, why are GM and Nissan, of all companies, banding together with Tesla on this? As Bloomberg notes, the former is expected to reach the 200,000 vehicle cutoff later this year, and Nissan has already shipped out 125,000 EVs of its own.
The EV Drive Coalition is expected to approach Congress with a proposal laying out their desires in the future, but we don't have a specific timeframe for that just yet.