Quote:
Originally Posted by Wally86
I'd love to see your analysis of the tax incentives given by CA vs every other state and how that affects the actual purchase of electric cars there.
https://electrek.co/2020/11/17/calif...l-end-of-year/
Taking tax money to prop up vehicle sales is a great way to make sales but a horrible way (by the gov) to spend other people's money. |
I'm not denying those incentives exist, and they are a huge driving factor for adoption, which is why I think they should exist in all states to accelerate the rate of adoption until it is no longer necessary.
In some ways, I actually agree that the tax incentives can be a horrible way to spend people's money, especially when those rebates go to well-off individuals to buy luxury cars. I think there should be an income cap on rebates, but then again, if the goal is to advance the adoption and development of EVs then this is just one of the affective ways of achieving that goal. The idea is that eventually the tax incentives reduce until they eventually go away entirely. Tesla, for instance, no longer qualifies for Federal incentives, unless I'm mistaken.
The tax incentives are there to increase sales, so manufactures will invest more in EV products because they will see there is demand for the product if costs are down, but the reason costs are high is often because the product is a niche product for a limited customer base with a high cost of manufacturing. We have seen with Tesla, and with the ever decreasing cost of batteries per kWh, that scale of industry will reduce costs to levels where incentives are no longer needed. Another reason for incentives is to encourage adoption in a limited EV market. Up until recently, there was very few compelling EV options, but then we had Telsa, the Nissan Leaf and Chevy Bolt, yet still, we are only now barely getting more models and vehicle classes. We don't have an electric truck on the market. We don't have an affordable electric sports car. The lack of options necessitates some incentives to attract more buyers and encourage more development. Another reason is to encourage early adoption into unproven technology. EVs might be the best vehicle for the masses, but someone has to take the first leap of faith, so incentives are there to encourage adoption. Eventually there is enough word-of-mouth, there is enough saturation, etc that EVs go from a green, hippie thing to a norm, so incentives are no longer needed. States could invest in chargers. States could build up their infrastructure, but if the public doesn't expose themselves to a different option and manufactures are therefore never incentivized to give the public fair EV options, then all that investment goes to waste, so it has to happen in parallel.
My main point of bringing up California was to illustrate that EVs don't seem to be as functionally prohibitive there, yet Californians have similar commuting needs. If they were functionally prohibitive, incentives or not, people would not buy them. Also, if incentives were the only thing driving people to EVs in spite of the car being functionally restrictive then I would imagine used EVs would be cheap, which they typically are for several reasons including the tax inceptives reduced their price below MSRP and because fears of battery degradation. If sales necessitate tax incentives then EVs would have little demand from the used car market where there are little to no tax incentives, and yet, Teslas are always in high demand and with great resale value. In fact, the Model 3 has the best resale value, which is three times better than the industry average for ICEs, yet used car buyers don't get to benefit from tax credits. How can we explain this?
https://www.teslarati.com/tesla-mode...reciate-study/