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Is my $7500 tax credit in jeopardy

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How does it hurt Elon ? His company is the closest to losing the credit due to the phaseout clause, as Tesla is the closest to it. He stood to lose the most when Tesla ran out of the credit - while his competitors retained the benefit. Now that everyone's losing it in one stroke, every one of his competitors who could otherwise command a $7500 tax benefit on at least 200K cars each, no longer have that price competitiveness vs Tesla. And those like GM who have partially used up their benefit, lose their remaining runway.

I was curious what the running totals were

Year Tesla Nissan
2011 1900 9674
2012 2650 9819
2013 17650 22610
2014 16689 30200
2015 25202 17269
2016 47119 14006
2017 37257 10953

Tesla 148,467 with no more than 47,119 in a year (looks like Tesla can get another quarter or two in before hitting 200,000 US)
Nissan 114,531 with no more than 30,200 in a year (looks like Nissan can get another few years in, assuming no tax credit repeal)

Tesla's Nov and Dec last year were worth 11,725 US units, Q1 would be 12,000 units + Model 3. The ramp of Model 3 will decide when Tesla hits 200,000 US.
 
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Not sure you are right on this one. This is a Tax Credit not a Tax Deduction. Right?

Tax credits vs. tax deductions
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Please please, let’s not make this political, but if the new tax reform plan goes through, will this eliminate the $7,500 tax credit on my just purchased Model S? That would be quite a hit.

Logically, I would think that the new plan would not be retroactive to 2017, but rather going forward to 2018.

Any tax accountants out there with some idea?

It doesn't take a tax accountant.

The answer is it does NOT eliminate the $7500 tax credit for a car purchased and delivered in 2017.
 
I categorically disagree. I think it will hurt Tesla the least, but adding $7500/$3250 to the price of every electric vehicle sold over the next two years is going to cost them some business.
I think you missed the original point. Yes it will add the amount you say to every EV for the next 2 years, *except* for Tesla, where it would add only for 6-9 months since the rebate eligibility will end for Tesla by Q2 or Q3 next year. Even if you think Model 3 production will struggle to reach meaningful numbers for another year, with moderate numbers of Model 3 and continued success of Model S & X will likely end Tesla's eligibility way before 2 years from now.
 
I agree in the short term it hurts Tesla.....................that's obvious.

It's really not obvious.

Tesla has pre-sold more Model 3's than they could possibly hope to deliver even if the tax break remains to the max. Even if 30% of the U.S. customers dropped off as a result, they would have still had a year-long backlog after the tax break have run dry. The tax credit makes zero difference to the number of Model 3's they'll be able to sell in that time.

The only open question is - does this suppress sales after the backlog is gone? Well, they just made all the competitors $7500 more expensive. So I can't see how it does.

Finally, there are now just under 2 months left for getting the tax break. What do you want to bet that some of those Model 3 dropoffs are now out looking at Model S's in a hurry? I know of at least one personally...
 
The only open question is - does this suppress sales after the backlog is gone?
How does the answer to this question change whether or not the credit gets repealed in by 1/2018 or they lose eligibility by 11/2018? The number of Model 3's sold will be exactly the same as there is enough backlog to sustain sales through next year even without the rebate.

So, short term, repealing the incentive has no effect (on Tesla, I get that individual Model 3 customers may be affected). Long term, it can only help as it levels the playing field after the backlog is gone.

So, the only way I can see repealing the tax rebate could hurt Tesla is potentially losing some sales from Model 3 reservation holders who would stretch for a new S75D, but without the rebate they'll just wait - so delayed sale for Tesla with a possibility to losing the sale to competition catching up.
 
How does the answer to this question change whether or not the credit gets repealed in by 1/2018 or they lose eligibility by 11/2018? The number of Model 3's sold will be exactly the same as there is enough backlog to sustain sales through next year even without the rebate.

So, short term, repealing the incentive has no effect (on Tesla, I get that individual Model 3 customers may be affected). Long term, it can only help as it levels the playing field after the backlog is gone.

That's exactly what I said. You quoted me out of context. My full quote for that was:

The only open question is - does this suppress sales after the backlog is gone? Well, they just made all the competitors $7500 more expensive. So I can't see how it does.
 
It's really not obvious.

Tesla has pre-sold more Model 3's than they could possibly hope to deliver even if the tax break remains to the max. Even if 30% of the U.S. customers dropped off as a result, they would have still had a year-long backlog after the tax break have run dry. The tax credit makes zero difference to the number of Model 3's they'll be able to sell in that time.

The only open question is - does this suppress sales after the backlog is gone? Well, they just made all the competitors $7500 more expensive. So I can't see how it does.

Finally, there are now just under 2 months left for getting the tax break. What do you want to bet that some of those Model 3 dropoffs are now out looking at Model S's in a hurry? I know of at least one personally...

I believe it will hurt Tesla but in sales alone, no. Tesla will be hitting the 200,000 mark next year anyway. I wonder how many people will get fewer options w/o the credit. Sounds like a poll question :)
 
The only open question is - does this suppress [Tesla] sales after the [Model 3] backlog is gone? Well, they just made all the competitors $7500 more expensive. So I can't see how it does.
Well, what about lost Model S and X sales in 2018? Loss of the fed tax credit may make some of those prospective buyers go with a luxury ICE instead, or at least sit on their hands until the MS and/or MX get majorly upgraded so as to be 'worth' the now-higher price.

And even in the longer-term, I don't know that it's a good thing for Tesla, 'level playing field' vs EV competitors or not.

It'll definitely hurt EV sales in the US overall, which is where Tesla sells over 50% of their vehicles. EVs in the US were poised to really take off, this'll now slow or perhaps even temporarily stall that (look at what happened in Georgia when incentives got removed). Fewer new product introductions if automakers scale back their US EV plans in response, less EV 'mindshare' among US consumers, etc. etc.

Not great. :(

On the plus side, Europe and China will very likely still press ahead with their eventual ICE bans, which means that no matter what Big Oil and their lackeys do, they can't kill off the EV... even as much as they'd like to.

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Wonder if wiping out that tax credit was a subtle ****-you to Elon for quitting the panel he was on.
Probably not. Big Oil is an enormous and well-entrenched special interest that both historically and currently has a lot of sway over the party that formulated the tax bill. And EVs are a threat to their business, long-term, and they know it.

So, it's pretty easy to connect the dots. Staying on the panel wouldn't have changed a thing. It was in Big Oil's interest to get their lackeys to do what they're now trying to do, so that was going to happen no matter what.

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