President Biden’s Build Back Better plan includes a freshly revamped electric vehicle incentive scheme, which could officially mark the close of the combustion engine phase in the American automobile sector. The new Electric Vehicle tax credit structure could give up to $12,500 for an electric vehicle purchase, but that’s not the greatest part. The bill’s language incorporates new body forms and encourages local manufacture as the EV sector embraces new car styles and expands to more people. Furthermore, automobiles acquired from a unionized facility will receive an additional $4,500, plus an additional $500 if US-made batteries are being used in the vehicle.
Anyone who buys an electric vehicle from a firm in the United States which has not sold 200,000 units is currently eligible for a $7,500 rebate. Because they have exceeded the 200k car threshold, GM and Tesla are currently barred from taking advantage of the EV incentive.
More information about the EV tax credit has been released in recent days, especially since the law was revised just a couple of days ago to cover SUVs, trucks, and vans. In addition, new income eligibility standards have been lowered, making the credit ineligible for a larger number of people.
Vehicle Type Price Caps
Price caps for body shapes are among the most recent amendments to the law. SUVs costing up to $80,000 are going to now be eligible, up from the previous limit of $69,000. Trucks have also been raised to about $80,000 from $74,000, whereas vans with a price of up to $80,000 will now be eligible. Sedans will be eligible for the “Other” category if they cost less than $55,000.
In the future years, electric trucks will make up a considerable portion of the US EV market. Rivian will face heavy competition from the GMC Hummer EV, the Ford F-150 Lightning, and the Tesla Cybertruck after starting initial deliveries of the R1T earlier this month. With 160,000 pre-orders for F-150 Lightning and 1.5 million reservations for the Cybertruck, this industry will become more robust in the future years.
Income Limitation Revisions
Individual filers’ income limits have been reduced to $500,000 for the joint families, $375,000 for heads of households, and $250,000 for single filers. These are significant decreases, especially considering that single filers were eligible for incomes up to $400,000 and couple filers were not excluded until their annual income reached $800,000. After all, the measure specifies that the incentive is intended to make electric vehicles more affordable to middle-income Americans.