Tesla and other EV makers may have to say goodbye to $7,500 EV credit sooner than expected
The Senate’s newly released version of President Trump’s “big, beautiful bill” might be even worse news for Tesla and the rest of the electric vehicle industry than the initial one. Rather than eliminating the $7,500 EV tax incentive at the end of the year, as was the case in previous versions of the bill, it would now end September 30.
While it’s possible the change could increase Q3 sales, causing would-be buyers to move forward their purchases to take advantage of the tax credit, it would likely hurt Q4 sales, the analyst who goes by Troy Teslike wrote. Analysts are already bracing for an awful Q2 Tesla sales report this week and are expecting full-year deliveries to decline for the second year in a row.
Last year, JD Power found that about two-thirds of premium brand EV owners said tax credits were a main driver in their EV purchase decision.
To combat the loss of incentive, Tesla would likely have to lower prices and take a hit to its margins or deal with lower demand. JPMorgan previously said the pending legislation — both the elimination of EV tax credits and the regulatory credits Tesla sells to other automakers — could threaten half of Tesla’s profits.
Tesla CEO Elon Musk is none too happy.
This weekend he tweeted his dislike of the latest bill, saying it “will destroy millions of jobs in America and cause immense strategic harm to our country” and that its clean energy provisions would be “incredibly destructive to America.”
While it’s possible the change could increase Q3 sales, causing would-be buyers to move forward their purchases to take advantage of the tax credit, it would likely hurt Q4 sales, the analyst who goes by Troy Teslike wrote. Analysts are already bracing for an awful Q2 Tesla sales report this week and are expecting full-year deliveries to decline for the second year in a row.
Last year, JD Power found that about two-thirds of premium brand EV owners said tax credits were a main driver in their EV purchase decision.
To combat the loss of incentive, Tesla would likely have to lower prices and take a hit to its margins or deal with lower demand. JPMorgan previously said the pending legislation — both the elimination of EV tax credits and the regulatory credits Tesla sells to other automakers — could threaten half of Tesla’s profits.
Tesla CEO Elon Musk is none too happy.
This weekend he tweeted his dislike of the latest bill, saying it “will destroy millions of jobs in America and cause immense strategic harm to our country” and that its clean energy provisions would be “incredibly destructive to America.”
