Should I wait to Order MYLR? Tax Credit?

[Snow Drift]

Tesla is unlikely to raise prices. Actually some think they may have to lower prices. Even more so if interest rates rise.

$3,750 or sure and highly likely $7,500 savings is coming in 3 months.

Pluses for people with cash or big down payment, interest burden isn't that bad.

Elon said the same. If supplier costs come down, MSRP could as well. However, I don't expect a large decrease as demand is crazy even at these prices.

...but I would prefer to pay less. The MY LR AWD was an incredible deal at $53k in 2020....now, it's a stretch. Not that anything else is better, it's just a financial stretch for many.

 

[AndrewZ]

Something to keep in mind here is that after the end of 2024, a vehicle containing any critical battery minerals or components sourced from foreign entities of concern (Russia, China, Iran, and North Korea are currently listed) will be entirely disqualified for both halves of the credit.

Disclaimer that I'm pessimistic, but we truly do not even know if the Model Y will get the $80k SUV limit and here's my reasoning:

I couldn't find a single competitor to the Model Y -- in terms of size, seating, etc -- that approaches $80k. A Model Y LR was down below $50k in 2021 before the crazy price hikes, and neither the LR or P approach this limit even at the much higher prices. An $80k limit on vehicles of this type/size seems gratuitous and IMO doesn't make sense when even the highest end luxury small SUVs are still far below $80k.

I think it's possible the Model Y will be held to the $55k limit for "Other" vehicles along with the Model 3. The X could be called a real SUV and might get the $80k limit, but generally I suspect the higher limit is for very large SUVs and trucks that will require very large battery packs and consume tons of power -- the Cybertruck would also fit in that category.

I'll be surprised if the $80k limit is intended to subsidize ultra luxury fully loaded crossovers and small SUVs, because that's what would be required to hit $80k in a vehicle of this size, but I guess we'll see.

 

[voxel]

The tax credit acts like a price cut.

Also... competitors losing their credit essentially makes them more expensive so the price difference has shrunken $15K.

 

[voxel]

I'll be surprised if the $80k limit is intended to subsidize ultra luxury fully loaded crossovers and small SUVs, because that's what would be required to hit $80k in a vehicle of this size, but I guess we'll see.

$80K was set to appease Ford and the EV trucks. It has nothing to do with Tesla.

 

[AndrewZ]

$80K was set to appease Ford and the EV trucks. It has nothing to do with Tesla.

An $80k limit for trucks makes sense, the Cybertruck will be expensive. The F150 Lightning has a battery pack starting at 98 kWh and going above 130.

An $80k limit for larger SUVs also makes sense, the Rivian R1T has a battery pack ranging from 105 to 180 kWh.


A Model Y with an 82 kWh battery pack, the same as the Model 3 while sharing like 75% of the parts and that was below $50k MSRP just a year and a half ago, I don't think that makes much sense. But nonsensical things happen all the time.

 

[acpd]

Something to keep in mind here is that after the end of 2024, a vehicle containing any critical battery minerals or components sourced from foreign entities of concern (Russia, China, Iran, and North Korea are currently listed) will be entirely disqualified for both halves of the credit.

Disclaimer that I'm pessimistic, but we truly do not even know if the Model Y will get the $80k SUV limit and here's my reasoning:

I couldn't find a single competitor to the Model Y -- in terms of size, seating, etc -- that approaches $80k. A Model Y LR was down below $50k in 2021 before the crazy price hikes, and neither the LR or P approach this limit even at the much higher prices. An $80k limit on vehicles of this type/size seems gratuitous and IMO doesn't make sense when even the highest end luxury small SUVs are still far below $80k.

I think it's possible the Model Y will be held to the $55k limit for "Other" vehicles along with the Model 3. The X could be called a real SUV and might get the $80k limit, but generally I suspect the higher limit is for very large SUVs and trucks that will require very large battery packs and consume tons of power -- the Cybertruck would also fit in that category.

I'll be surprised if the $80k limit is intended to subsidize ultra luxury fully loaded crossovers and small SUVs, because that's what would be required to hit $80k in a vehicle of this size, but I guess we'll see.

Great point. In that case Tesla might come out with MYSR to qualify for under $55k. I believe it was reported to be $60k, so not sure what would they have to take out to get to $55k.

 

[Snow Drift]

Something to keep in mind here is that after the end of 2024, a vehicle containing any critical battery minerals or components sourced from foreign entities of concern (Russia, China, Iran, and North Korea are currently listed) will be entirely disqualified for both halves of the credit.

Disclaimer that I'm pessimistic, but we truly do not even know if the Model Y will get the $80k SUV limit and here's my reasoning:

I couldn't find a single competitor to the Model Y -- in terms of size, seating, etc -- that approaches $80k. A Model Y LR was down below $50k in 2021 before the crazy price hikes, and neither the LR or P approach this limit even at the much higher prices. An $80k limit on vehicles of this type/size seems gratuitous and IMO doesn't make sense when even the highest end luxury small SUVs are still far below $80k.

I think it's possible the Model Y will be held to the $55k limit for "Other" vehicles along with the Model 3. The X could be called a real SUV and might get the $80k limit, but generally I suspect the higher limit is for very large SUVs and trucks that will require very large battery packs and consume tons of power -- the Cybertruck would also fit in that category.

I'll be surprised if the $80k limit is intended to subsidize ultra luxury fully loaded crossovers and small SUVs, because that's what would be required to hit $80k in a vehicle of this size, but I guess we'll see.

EPA categorizes the Model Y as a “Small Sport Utility Vehicle 4WD.” So it qualifies.

2022 Tesla Model Y Long Range AWD

Fuel Economy of the 2022 Tesla Model Y Long Range AWD. Compare the gas mileage and greenhouse gas emissions of the 2022 Tesla Model Y Long Range AWD side-by-side with other cars and trucks

www.fueleconomy.gov

 

[AndrewZ]

EPA categorizes the Model Y as a “Small Sport Utility Vehicle 4WD.” So it qualifies.

2022 Tesla Model Y Long Range AWD

Fuel Economy of the 2022 Tesla Model Y Long Range AWD. Compare the gas mileage and greenhouse gas emissions of the 2022 Tesla Model Y Long Range AWD side-by-side with other cars and trucks

www.fueleconomy.gov

Yup checking the EPA categories was part of my research into this, but nobody knows how it will be applied exactly and the Bill says the determination really comes down to the Secretary of the Treasury while using guidelines similar to the EPA and DoE's criteria for size and class.

People are optimistically assuming the Y will be slotted in there and it very well may be, but it's not guaranteed and doesn't seem logical. There's not a single "Small Sport Utility Vehicle 4WD" that comes close to $80k. The Model Y and Model 3 share the same battery pack, and the section of this Bill is all about battery minerals and components and the supply chain. I wouldn't be surprised if the SUV/Truck category is reserved for actual full size SUVs and trucks with larger battery packs, $80k is a crazy high price limit for vehicles of this size and that shows in the MSRP of vehicles in this class -- the Model Y LR was $48,990 less than two years ago before Tesla added $17k to the price and yet it's still far from $80k.

It makes far more sense to think that category will be for full size SUVs and trucks with much larger battery packs that will cost far more by default, $55k is plenty for a vehicle the size of a Y.

 

[Snow Drift]

Yup checking the EPA categories was part of my research into this, but nobody knows how it will be applied exactly and the Bill says the determination really comes down to the Secretary of the Treasury while using guidelines similar to the EPA and DoE's criteria for size and class.

People are optimistically assuming the Y will be slotted in there and it very well may be, but it's not guaranteed and doesn't seem logical. There's not a single "Small Sport Utility Vehicle 4WD" that comes close to $80k. The Model Y and Model 3 share the same battery pack, and the section of this Bill is all about battery minerals and components and the supply chain. I wouldn't be surprised if the SUV/Truck category is reserved for actual full size SUVs and trucks with larger battery packs, $80k is a crazy high price limit for vehicles of this size and that shows in the MSRP of vehicles in this class -- the Model Y LR was $48,990 less than two years ago before Tesla added $17k to the price and yet it's still far from $80k.

It makes far more sense to think that category will be for full size SUVs and trucks with much larger battery packs that will cost far more by default, $55k is plenty for a vehicle the size of a Y.

There are only a few categories of passenger vehicles. The Model Y is an SUV. The Mustang Mach E is an SUV. SUVs look like SUVs. It has nothing to do with price. The Suzuki Jimny is an SUV and it is cheap.

They are not cars (sedan/wagon/coupe), vans or pickup trucks.

 

[AndrewZ]

There are only a few categories of passenger vehicles. The Model Y is an SUV. The Mustang Mach E is an SUV. SUVs look like SUVs. It has nothing to do with price. The Suzuki Jimny is an SUV and it is cheap.

They are not cars (sedan/wagon/coupe), vans or pickup trucks.

I'm bringing up price because the price of an EV is hugely affected by the single most expensive component in an EV: the battery, which is what this Bill is all about. A full size SUV or truck will cost more than a vehicle the size of a Y simply because the battery pack is much larger, and the additional costs associated with manufacturing a battery domestically will scale with the size of that battery.

Then when you look at the other components of the bill, like the Used vehicle tax credit limit set at a $25k sale price, it's super conservative and then you have an $80k limit for a Model Y? Dang near double the cost of a Y LR before the price hikes, which was already considered a Premium/Luxury Small SUV?

I wouldn't be at all shocked to see battery sizes associated with these categories when it actually comes into effect. Maybe it won't, but we have no idea at this point.

What if the "Inflation Reduction Act" is intended to subdue EV price inflation by building in low price limits to qualify for the credit, thus forcing the largest EV manufacturer to cut prices in order to qualify?

 

[Snow Drift]

I'm bringing up price because the price of an EV is hugely affected by the single most expensive component in an EV: the battery, which is what this Bill is all about. A full size SUV or truck will cost more than a vehicle the size of a Y simply because the battery pack is much larger, and the additional costs associated with manufacturing a battery domestically will scale with the size of that battery.

Then when you look at the other components of the bill, like the Used vehicle tax credit limit set at a $25k sale price, it's super conservative and then you have an $80k limit for a Model Y? Dang near double the cost of a Y LR before the price hikes, which was already considered a Premium/Luxury Small SUV?

I wouldn't be at all shocked to see battery sizes associated with these categories when it actually comes into effect. Maybe it won't, but we have no idea at this point.

What if the "Inflation Reduction Act" is intended to subdue EV price inflation by building in low price limits to qualify for the credit, thus forcing the largest EV manufacturer to cut prices in order to qualify?

I think you are overthinking the IRA. Think of it this way: $80k SUV/Van/Truck max means GM gets to use it for just about everything they sell. This Act was created to benefit GM and Ford, period.

$30k Bolt EUV
$30k Equinox EV
$40k Blazer EV
$40k Silverado EV
$50k Sierra EV
$60k Lyriq

$45k Mustang Mach E
$46k Lightning
$50k E-Transit EV
$70k Lightning Lariat

If they cared about inflation they would have used a $55k max for all passenger vehicles, not just sedans, which are not sold in nearly as large a volume. Trucks and SUVs are the bread and butter of the industry. They are expensive.

 

[AndrewZ]

I think you are overthinking the IRA. Think of it this way: $80k SUV/Van/Truck max means GM gets to use it for just about everything they sell. This Act was created to benefit GM and Ford, period.

$30k Bolt EUV
$30k Equinox EV
$40k Blazer EV
$40k Silverado EV
$50k Sierra EV
$60k Lyriq

$45k Mustang Mach E
$46k Lightning
$50k E-Transit EV
$70k Lightning Lariat

If they cared about inflation they would have used a $55k max for all passenger vehicles, not just sedans, which are not sold in nearly as large a volume. Trucks and SUVs are the bread and butter of the industry. They are expensive.

Any EV truck or full-size SUV below $55k would be massively underpriced, the base Lightning included and Ford will likely not produce too many of those because they are surely losing big money on them. The Lightning Lariat at $70k, I don't know how they're making money at that price either when a truck of that size with that battery pack and interior is <$5k more than a Model Y LR. I expect the Cybertruck to be priced significantly above $80k.

I don't think the bill is designed to benefit any one manufacturer, it's designed to bring manufacturing out of China and push prices lower. The other aspects of the bill providing credits directly to companies for domestic manufacturing etc would also allow these companies to slash prices, fit into lower categories, and still come out ahead.

 

[Snow Drift]

Any EV truck or full-size SUV below $55k would be massively underpriced, the base Lightning included and Ford will likely not produce too many of those because they are surely losing big money on them. The Lightning Lariat at $70k, I don't know how they're making money at that price either when a truck of that size with that battery pack and interior is <$5k more than a Model Y LR. I expect the Cybertruck to be priced significantly above $80k.

I don't think the bill is designed to benefit any one manufacturer, it's designed to bring manufacturing out of China and push prices lower. The other aspects of the bill providing credits directly to companies for domestic manufacturing etc would also allow these companies to slash prices, fit into lower categories, and still come out ahead.

It directly benefits GM, Ford and their North American, mostly union run, factories at the detriment of foreign built cars. Tesla just got lucky that the SUV price was above the MY LR AWD. They still need to lower the M3 LR AWD price to benefit.

If foreign manufacturers move production here, that will increase prices due to the increased cost of labor and retooling of factories. Yes, they will save on transit costs for finished cars.

This may also reduce EV sales as most EVs are not built in the US, and tons of models are no longer eligible today, and few will be eligible in the near future due to battery minerals/production. It's a flawed Act in many ways.

I am happy Tesla and GM get access, especially at the lower end <$55k for sedans. That is the most important part. We need more $30-50k EVs to steal sales from that price range ICE sedan/SUV market....which are normal folks.

Hopefully Chevy builds a lot of Equinox at ~$30k, which is their best selling SUV, in order to further the transition to EV by mass-market consumers.

 

[DCGOO]

researching the tax credit today and it appears there is a requirement that the battery components are sourced in the USA. Teslas is sourced from China. Apparently most EVs won’t qualify due this requirement.

If you order a long range, it will likely come with 2170 batteries which are all .US made. Likewise for the 4680.

 

[AndrewZ]

It directly benefits GM, Ford and their North American, mostly union run, factories at the detriment of foreign built cars. Tesla just got lucky that the SUV price was above the MY LR AWD. They still need to lower the M3 LR AWD price to benefit.

If foreign manufacturers move production here, that will increase prices due to the increased cost of labor and retooling of factories. Yes, they will save on transit costs for finished cars.

This may also reduce EV sales as most EVs are not built in the US, and tons of models are no longer eligible today, and few will be eligible in the near future due to battery minerals/production. It's a flawed Act in many ways.

I am happy Tesla and GM get access, especially at the lower end <$55k for sedans. That is the most important part. We need more $30-50k EVs to steal sales from that price range ICE sedan/SUV market....which are normal folks.

Hopefully Chevy builds a lot of Equinox at ~$30k, which is their best selling SUV, in order to further the transition to EV by mass-market consumers.

I couldn't find a single vehicle in the EPA "Small Sport Utility Vehicle" category that even comes close to $80k so I'm not sure that's luck lol, that limit would just be seriously gratuitous for a vehicle of this size.

It's a flawed act if you look at it through a lens of trying to increase EV demand, but that's not the intent. The demand already exists, this bill is almost entirely about national energy security and reducing China's near-complete dominance over the EV battery supply chain. The US should not be using taxpayer money to subsidize China's further control over this, which they could very easily use for leverage in the future.

 

[Snow Drift]

I couldn't find a single vehicle in the EPA "Small Sport Utility Vehicle" category that even comes close to $80k so I'm not sure that's luck lol, that limit would just be seriously gratuitous for a vehicle of this size.

It's a flawed act if you look at it through a lens of trying to increase EV demand, but that's not the intent. The demand already exists, this bill is almost entirely about national energy security and reducing China's near-complete dominance over the EV battery supply chain. The US should not be using taxpayer money to subsidize China's further control over this, which they could very easily use for leverage in the future.

There doesn't need to be a Small SUV for $80k. It's $80k for Trucks, Vans and SUVs. They can all be $80k easily.

**Tesla Existing Inventory - MY LR AWD w/ FSD = $80k+.

The Act was hampered and designed to say they want to promote EVs but actually reduce EV sales. The vast majority will not qualify for many many many years. So the only short term winners are GM, Ford and a few Teslas. Yes, they will hurt China in the long run, but at the sake of making all existing and upcoming EVs more expensive and further benefiting their ICE segment rivals.

China has the minerals. We need them. Australia, Canada (I think) and some others, have deposits, but at what cost? I am not trying to help China, but we need to transition quickly, and not set up extra rules that just benefit the fossil fuel industry.

Demand is high for expensive premium/luxury EVs, but our total % of new car sales is still very low. So in reality, the environmental/social benefit to North Americans is very low. F150 Lightning at volume will help a ton, as would an EV Camry... but that doesn't exist. If you really want to transition the average buyer, EVs need to be $30-40k, before incentives.

 

[acpd]

I could see Tesla sell Model Y with low range ( say 240) for $55k. They would allow you to increase range (280) by paying more later.

 

[AndrewZ]

Tesla could just roll back the $17k of price increases since early 2021 and the LR will be well below $55k lol

 

[Zalick]

If you order a long range, it will likely come with 2170 batteries which are all .US made. Likewise for the 4680.

Are the Minerals sourced in countries outside of the blacklisted ones?

 

[AndrewZ]

Are the Minerals sourced in countries outside of the blacklisted ones?

Highly unlikely but it could get $3,750 for manufacturing the batteries domestically

I don't know if anything will qualify for the full $7,500 right off the bat and it'll likely be a challenge getting that before the end of 2024 cutoff for any materials coming from foreign entities of concern