Thursday, November 11, 2010

GE: Eating Up EV Tax Credits

Is there a downside to the public to GE's announcement that it will buy 25,000 EVs, including 12,000 Chevrolet Volts?  

The tax credit for EVs phases out after a manufacturer sells 200,000 of them.  From Public Law 111-5, Sections 1141-1144

    `(2) PHASEOUT PERIOD- For purposes of this subsection, the phaseout period is the period beginning with the second calendar quarter following the calendar quarter which includes the first date on which the number of new qualified plug-in electric drive motor vehicles manufactured by the manufacturer of the vehicle referred to in paragraph (1) sold for use in the United States after December 31, 2009, is at least 200,000.
By gobbling up EVs, GE certainly helps to jump-start the industry, but they also gobble up future tax credits that consumers would have gotten, unless GE opts to forego the EV tax credit.  Which would be bad business.

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