Tesla buyers could take advantage of new federal tax breaks for electric vehicles next year, executives at the automaker said Wednesday. Loans can reach $7,500 for new cars and $4,000 for used cars Tesla’s eligibility for previous tax breaks ended in January 2020 when it exceeded the threshold of 200,000 vehicles sold to each automaker. 200,000 vehicle cap was lifted on January 1 under new rules The new requirements are stricter than the previous system. Tesla expects the US Treasury to issue detailed guidance by the end of the year.
The law is open to some interpretations of how it would calculate the cost of battery components, but to receive half of the $7,500 credit, a significant portion of the components must be manufactured or assembled in North America. The other half depends on significant minerals mined or processed in the United States or in a country with a free trade agreement. Interest rates will gradually increase in 2024-2029.
“Until then, the eligibility criteria are difficult to fully define, but we believe Tesla is very well positioned to capture a significant chunk of it for solar storage and electric vehicles as well,” he said. (Tesla often doesn’t identify people speaking on behalf of the company on investor calls.) Records are reversed for the automaker Tesla CEO Elon Musk spoke out against proposed tax credits for electric cars last year.
“We don’t need the $7,500 tax credit. Honestly, I would have paid the entire bill. Don’t pass it,” Musk said of the December 2021 infrastructure bill, citing concerns about the growing US deficit. When the original proposal to expand the electric vehicle tax credit included additional funds for vehicles built by unionized workers, Musk again came under fire. “It is unclear how this serves the American taxpayer,” Kasturi said. “This is written by Ford/UAW lobbyists who manufacture their electric vehicles in Mexico.”
Musk had a contentious relationship with the Biden administration and feared the White House was emphasizing his rivals’ electric car efforts over his own. Earlier this month, Musk told Republican Sen. Lindsey Graham that “we didn’t ask for it, GM and Ford did,” referring to tax credits included in the Tax Reduction Act. ‘inflation.
But Tesla and its executives took the tax credits even further on Wednesday. “We view the passage of the Cut Inflation Act as a significant boost to accelerate our goal of expanding the battery supply chain in the United States,” a Tesla executive said during the meeting. the call.
Tesla allows the public to vote on questions its leaders must answer. The question that received the most votes was Tesla’s ability to meet electric vehicle tax credit limits in 2023, 2024, and 2025.Tesla didn’t specify a specific year, but Musk said “at a high level we expect to be fully IRA compliant.” Another Tesla representative noted on the call that it manufactures its battery modules and cars in the United States, which should help it qualify.
Half of Tesla’s line of cars wouldn’t be considered standard without a massive price cut. The Tesla Model X SUV and Tesla Model S sedan seem unlikely to meet the requirement, as the SUV can cost less than $80,000 and the sedan cannot exceed $55,000. The most affordable Model X is $120,990 and the cheapest Model S is $104,990.