Get Your Electric Car Order In ASAP! Trump Plans To Kill $7,500 EV Tax Credit. – CleanTechnica

Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!

---

Well, here we go. Aside from some truly insane and absurd Cabinet picks, which I’m not even going to write about here (but let’s just say it’s well beyond putting the foxes in charge of the henhouse), we’re getting some initial leaks on Donald Trump’s legislative plans when he takes office again. One of those, according to exclusive reporting from Reuters based on two sources, is to kill the $7,500 EV tax credit.

Tesla Does Not Benefit from This

Before we go into anything else, in my humble opinion, it’s idiotic to claim that this will help Tesla. I know some people have said that, but it’s a really stupid take. As we’ve been saying for years, while there’s naturally some competition between EVs, the main competition is between EVs and gas-powered cars. Make the most popular electric cars $7,500 more expensive, and EV sales are going to be lower, including Tesla’s sales.

I’ve talked to multiple people in the real world who bought an electric car (including Teslas) because their accountant told them to do so for the tax credit. All of those sales will be gone. Others are going to compare prices and determine that without a $7,500 discount, they’re going with a cheaper gas car.

Tesla has already been losing sales this year, especially in one of its biggest markets, California. The time when Tesla had more demand than it could build cars for is long over. The company shared a few weeks ago that it aims to increase sales next year by 20–30% without adding or expanding any production lines. In other words, it’s producing fewer cars — a lot fewer cars — than it has production capacity for. Now, it is going to lose a huge subsidy that stimulates vehicle purchases and leases in multiple significant ways. Good luck with that.

A Lot of Losers

Furthermore, I don’t know where the idea comes from that it’s good for Tesla because it’s bad for other EVs. Tesla’s original mission was to accelerate the move to EVs. In fact, Elon Musk thought Tesla would fail but was going forward with it primarily to push legacy automakers to offer good electric cars. Now they’re offering good electric cars and he wants them to have more trouble selling these cars? It’s all nonsense and ridiculous.

The IRA had really opened up EVs to more people, because it allowed the $7,500 tax credit to be rolled right into EVs up front and through leasing. It’s been a great help keeping US EV sales growing even as Tesla sales have declined. It’s also definitely meant less bleeding for Tesla, as it’s made Tesla vehicles financially accessible to more people.

Naturally, stock market prices of all US EV companies were down today, including Tesla’s. Surprise, surprise.

Oil & Gas Billionaires Win Again

Of course, it’s not all about Elon Musk’s descent into an upside down world. Frankly, as one might say, Musk has bent the knee in order to try to get other things. Trump has also made allies with oil and gas billionaires — for years, in fact, and he probably relates to them much more than he relates to Musk, who he has called weird. “Repealing the subsidy, a signature measure of Democratic President Joe Biden’s Inflation Reduction Act (IRA), is being discussed in meetings by an energy-policy transition team led by billionaire oilman Harold Hamm, founder of Continental Resources, and Republican North Dakota Governor Doug Burgum, the two sources said,” Reuters reports. 78-year-old Hamm appears to be one of the few people who’s genuinely friends with Trump.

US to Fall Behind China Further

Of course, then there’s the China angle. As Mike Barnard and I have discussed in recent days, the US is going to cede more and more global influence and more and more business (and economic benefit) to China by pulling back on EV growth and progress. You have to be an idiot or massively misinformed to not realize the future of automobiles is electric, and increasingly the present, and that the companies leading on EVs will lead in global auto sales around the world. Slowing down the US EV industry is just going to hurt the US economy in the long term. Naturally, auto companies can develop models for different markets, but that’s missing the point. Chinese companies like BYD, NIO, Xpeng, and Zeekr are selling boatloads of electric cars in China, which is bringing down their production costs, which is making them more and more competitive in foreign markets. Well, kudos to China for leading.

“It would be so counterproductive,” US Energy Secretary Jennifer Granholm told reporters today at the COP29 climate conference when she was asked about the Reuters report. “You eliminate these credits, and what do you do? You end up ceding the territory to other countries, particularly China.” Exactly. At least we had sane and smart climate and economy leaders in the Cabinet for a few years.

Go Get Shopping!

There are clearly two takeaways from this news:

1. If you want to buy an electric car anytime soon, do it quick! You’ll want to take delivery before 2025.
2. The US is certainly no longer a world leader in many regards, and we’re going to fall further and further behind as long as we continue to elect people trying to take us back to the 1980s.

Happy Friday everyone! Now go get EV shopping!

Oh, yeah, and adding that picture at the top reminded me of something else. Tesla was set to make a lot of revenue on non-Tesla EVs using the company’s Superchargers. It looks like we can expect slower revenue growth from that as well.

There was a popular phrase used during Donald Trump’s first term, “Everything Trump touches dies.” Sadly, it turned out to be an accurate claim time and time again. One would hope Tesla doesn’t crash and burn, but there are multiple ways aligning with the orange mob boss can and likely will hurt Tesla. God help us all.