How Does the Inflation Reduction Act of 2022 Affect EVs?
Capitol Hill plays an important role in the electric future of the United States of America. The current administration has been vocal about its stance on climate change and carbon emission reduction. Now, Senate Democrats have passed a bill that could have a huge impact on electric vehicle prices (if it is finalized). Thanks to a revised federal electric vehicle tax incentive, consumers can save thousands on eligible EVs from brands like Ford and Chevrolet.
The Inflation Reduction Act of 2022 has some sweet EV benefits baked into it
There are many issues prevalent in our society that are polarizing to American citizens. There is one thing we can all agree on. Saving money feels good. Folks who vote Democrat, Republican, or Independent enjoy saving money. The Inflation Reduction Act of 2022 could save millions of Americans big bucks on eligible electric vehicle purchases if the U.S. House of Representatives finalizes the act.
Saving money on electric vehicle purchases sounds nice, but which automakers have the most to gain from the bill? Ford and Chevrolet could benefit the most if the act is passed without any changes.
Ford and Chevy could win big thanks to the Inflation Reduction Act of 2022
If the House of Representatives passes the act, the U.S. Government will remove the sales cap on the federal electric vehicle tax incentive. This is huge news for Ford, an automaker that is in the process of losing its tax incentive eligibility due to the sales cap.
The act could save automakers by removing the 200,000-unit sales cap and allowing consumers to benefit from the full $7,500 tax credit rather than a reduced incentive. Yahoo Finance claims that even models that were no longer eligible for the previous incentive program, like the Tesla Model Y, Model 3, Chevrolet Bolt EV, and Bolt EUV, could benefit from the new proposed incentive.
If the Bolt EV and Bolt EUV were to receive tax credit eligibility, they’d be extremely affordable. The Chevy Bolt EV currently starts at just $25,600. If the full tax credit does apply to the electric hatchback, consumers could pay just $18,100 for an EV with 259 miles of range. The Bolt EV and Bolt EUV also recently got new batteries.
Ford was on its way to losing its full tax credit eligibility because of Ford F-150 Lightning and Mustang Mach-E sales. A full incentive extension would keep the Blue Oval’s EVs affordable for consumers.
Is the Inflation Reduction Act of 2022 good for electric vehicles?
According to Yahoo News, there are plenty of internationally-made electric vehicles that won’t be eligible for the revamped tax incentive. The incentive will benefit plenty of North American-made EVs like the Ford Mustang Mach-E, Jeep Wrangler 4xE, Tesla Model Y, and many more. The act is great for electric vehicles that meet the requirements of the refreshed incentive program. It isn’t so great for EVs that aren’t made in North America.
Read about some of the most undesirable EVs on the market in the next article below.