Toyota Approaches Federal Electric Vehicle Tax Credit Quota

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Toyota Motor Corp. appears to be the next automaker to exhaust its allotment of electric vehicle tax credits for the US market.

While the $ 7,500 rebate quota has already been met by Tesla and General Motors, Toyota is approaching 190,000 plug-in sales. The government has limited the incentives supported by the federal government to just 200,000 vehicles per manufacturer. Once the Japanese manufacturer reaches this limit, the credits enter a cool-down period where it can continue to receive the full amount six months after the end of the relevant quarter. From there, the incentives will be halved for the next two quarters until the business is no longer eligible.

Federal incentives for electric vehicles may be reset as part of the Build Back Better Act. However, the bill is currently deadlocked in Congress after being criticized for being too broad and costly. Automakers have also found themselves divided on this issue over provisions that would give union-backed automakers increased financial support. This included Toyota, which launched an advertising campaign opposing the tax credit program proposed by the Biden administrations in November.

Tesla has also opposed the United States to reviewing tax credits for electric vehicles, suggesting instead that automakers stick to the current limit of 200,000 vehicles. CEO Elon Musk also said he opposes any government providing continued financial assistance for electric cars, adding that electric vehicles should be self-sufficient to be taken seriously and ensure a healthy market. Criticism has also been leveled at the proposed regime for not having adequate sunset provisions that could cause the government to fund the production of electric vehicles indefinitely. But Toyota’s grievance appears to be based entirely on the White House wanting to favor unionized automakers by offering an additional $ 4,500 credit it would not qualify for.

“What does that say to the American auto worker who decided not to join a union?” Having said that, their job is worth $ 4,500 less because they made that choice, ”one of the ads asked. “What does this say to the American consumer? He says if they want to buy an electric vehicle that is not made by Ford, General Motors or Chrysler, they will have to pay an additional $ 4,500, or about $ 100 more per month over a four-year period.

Inside electric vehicles presumed that Toyota Motor North America will have easily surpassed 200,000 plug-in sales by the first quarter of 2022 after verifying that it sells more than 10,000 electrified vehicles with sufficiently large batteries (16 kWh or more) each trimester. This is bad news for anyone hoping to purchase the next bZ4X BEV, as it will only be eligible for the full $ 7,500 tax refund for a few months.

Unless Build Back Better passes, Ford is likely to be the next automaker to exhaust the Obama-era tax credit limitations. Blue Oval is estimated to be released in the fall or summer of 2022.

[Image: NeydtStock/Shutterstock]

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