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Discussion Starter #1
As I am planning my Bolt purchase later this year it occurred to me that the federal tax credit decreases once a manufacturer reaches 200,000 sales. I looked up GM's sales from insideevs and found that since 2011 GM has sold 136,000 sparks, volts, and bolts. Once they surpass 200,000 sales, the tax credit reduces for that particular manufacturer.

I expect this to happen sometime in 2018 based upon the success of the Volt and increasing sales of the bolt. I believe I read on insideevs a schedule of this anticipated timeline but couldn't remember where it was.

Just food for thought for those also considering purchasing from GM (or Nissan or Tesla for this matter).
 

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As I am planning my Bolt purchase later this year it occurred to me that the federal tax credit decreases once a manufacturer reaches 200,000 sales. I looked up GM's sales from insideevs and found that since 2011 GM has sold 136,000 sparks, volts, and bolts. Once they surpass 200,000 sales, the tax credit reduces for that particular manufacturer.

I expect this to happen sometime in 2018 based upon the success of the Volt and increasing sales of the bolt. I believe I read on insideevs a schedule of this anticipated timeline but couldn't remember where it was.

Just food for thought for those also considering purchasing from GM (or Nissan or Tesla for this matter).
Based on current sales, GM will hit the phaseout trigger probably in the second or third quarter of 2018. Remember that the trigger isn't an instant reduction in the credit. 2 quarters after the quarter in which the trigger is hit is when the reduction starts taking place. In other words, if GM hits 200K vehicles sometime between April 1st, 2018 and June 30th, 2018, the credit will get cut in half for purchases after September 30th.

If you scroll down to the bottom of the following webpage and click on "Phaseout" it will explain how things work:

http://www.fueleconomy.gov/feg/taxevb.shtml
 

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If the folks currently running our country get their way and actually do achieve a tax code "overhaul", it might all be a moot point. They likely would eliminate the tax credit altogether, so I'm still crossing my fingers that either they don't actually succeed in changing the tax code this year, or be sensible and let it die out naturally because all of us that bought this year would like to get the tax credit.

However, I decided the car was worth it to me even without the credit, so I'm not counting on getting it, just hoping.
 

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I think the bigger question will be, how many will cancel if they can't get a $200 a month lease deal on one. I bet the vast majority of those people with deposits have no intention of actually owning that car. They just want to rent it for awhile.
 

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I realize it is far too late to ask this question, but why is it a per manufacturer limit? That seems to reward the manufacturers who wait, rather than the ones who innovate. I think it would make more sense to have a combined limit.
 

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I realize it is far too late to ask this question, but why is it a per manufacturer limit? That seems to reward the manufacturers who wait, rather than the ones who innovate. I think it would make more sense to have a combined limit.
There is no particular reward for the manufacturer. The consumer gets the credit. There is a limit because congress wanted this to be a temporary credit. It's divided up between manufacturers because they didn't want it to be unfair to smaller companies. It was thought that big companies with lots of resources like GM, or Toyota would be in a better position to bring plug in cars to market rather than small companies like Subaru, or Volvo. It turned out that one of the biggest in the plug in market was a small start up, Tesla. Nobody knew that was going to happen when they wrote the legislation.
 

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I think the bigger question will be, how many will cancel if they can't get a $200 a month lease deal on one. I bet the vast majority of those people with deposits have no intention of actually owning that car. They just want to rent it for awhile.
The lease vs buy equation is going to change when the tax credits end. So far buying a new EV vs leasing has been a poor financial decision, possibly with the exception of Teslas.
 

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The lease vs buy equation is going to change when the tax credits end. So far buying a new EV vs leasing has been a poor financial decision, possibly with the exception of Teslas.
That just depends on which EV and how you intend to use it. I'm fine with my decision to buy my Bolt.
 

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Discussion Starter #10
It will be interesting to see if the reduction in credits affect sales next year.

Does anyone think the manufacturer would decrease cost to compensate?
 

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It will be interesting to see if the reduction in credits affect sales next year.

Does anyone think the manufacturer would decrease cost to compensate?
Not likely. There's just no where near that kind of profit in these cars. Most BEVs make zero profit for their manufacturers and are sold at a loss.

What is more likely is some states may up their rebates, or do a tax credit. Although it may be a tough sell to lawmakers when it is predicted that Tesla will be selling hundreds of thousands of BEVs even without the credit.
 

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A lot of the Tesla Model 3 deposits were made under the assumption that the buyer would get the rebates/tax credit, so some people may pull out from the purchase. Really hard to see what the Tesla sales will look like and how it'll affect future gov't incentives.

Chevy may not be making money on the Bolt, but they get tax credits that can be put towards less fuel efficient models or sibling brands.
 

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FWIW- I probably would have still purchased the Bolt if there was no Fed tax credit.

I got $3k off MSRP at the dealership and a $2K NY State "Drive Clean" POS rebate... so that was $5K off MSRP right there.
 

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This has been discussed before I think on this site but if not, most of the 400k reservations will get some form of tax credit. Once it's gone, it probably will impact sales but to how much is anyone's guess. Keep in mind, GM's credit allocation will probably be expiring around the same time. It will be interesting to see how sales are impacted for each.

But to the point made, the credit application goes into affect at title transfer and for US sales only. All the bolts, volts, Priuses, etc. that are sitting as inventory do not count towards the total. Tesla has made the statement that in regards to maximizing the tax credit to it's fullest potential, they will "do the right thing". Speculation has it that what they mean is they will either divert to Canada or stockpile inventory if they are approaching what would be the 200k car to be registered (remember that Tesla doesn't count a car as a sale until registration unlike traditional automakers who sell to the dealers) near the end of a quarter so that the 200,00th car will be registered early into the next quarter e.g. 1/3/2018. They now will have almost 6 months in which to get cars registered that will qualify for the full $7,500. After that, the next 6 months get $3,750 and then $1,875 for another 6 months. Based on their target for delivering 5-10k cars a week at about the same time as they are expected to delivery their 200k car, they would get 25 weeks x 5-10k =125k-250k cars for full credit and the same number for the reduction period. So it's entirely possible that not only would all the existing reservations get a good chunk of the credit, new reservations might too.
 

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A lot of the Tesla Model 3 deposits were made under the assumption that the buyer would get the rebates/tax credit, so some people may pull out from the purchase. Really hard to see what the Tesla sales will look like and how it'll affect future gov't incentives.

Chevy may not be making money on the Bolt, but they get tax credits that can be put towards less fuel efficient models or sibling brands.
GM doesn't get tax credits from the sale of a Bolt. What they get are are ZEV credits. GM has to have a certain of ZEV credits per year, which based on a three-year rolling average of total sales. They can bank excess credits for future years (which eventually expire or are reduced), or they can opt to sell excess credits to another manufacturer. If a manufacturer doesn't have enough credits, they are fined $5K per credit they are lacking.

You are correct that selling EVs does allow them to sell more gas-guzzling heavily optioned (profitable) models than if they didn't sell any EVs.
 
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