US tax credits for select Electric Vehicles in 2024

In 2024, the landscape of electric vehicle (EV) tax credits in the United States has shifted, with new regulations resulting in a reduced number of qualifying models. While previously, 43 models were eligible for tax credits, this year sees only 13 models meeting the criteria, a significant drop attributed largely to stricter battery sourcing rules.
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Source: Visual Capitalist

Among the eligible EV’s for a U.S. tax credit, of up to $7,500 at the point of sale, are popular models such as the Chevrolet Bolt EUV and Bolt EV, along with select Tesla variants including the Model 3 Performance and Model Y. Additionally, plug-in hybrid vehicles such as the Chrysler Pacifica PHEV and Ford Escape PHEV qualify for tax credits ranging from $3,750 to $7,500.

The streamlined process for customers is another positive change, as buyers will now automatically receive the discount at participating dealerships, eliminating the need for cumbersome tax paperwork.

Notably, the tax credit aims to incentivise consumers to switch to EV’s while encouraging the purchase of models sourced in America, aligning with broader initiatives to boost manufacturing and clean energy investment nationwide.

Amidst this landscape, several automakers are ramping up investment in American battery plants, with Toyota and Ford leading the charge. Despite Ford’s scaled-back EV investment, citing consumer reluctance to pay premiums for electric models, the industry continues to grow, with automakers like Lucid, General Motors, Honda, Nissan, and Stellantis also investing in domestic battery facilities.

As the EV market evolves and regulations adapt, the availability of tax credits serves as a key factor influencing consumer choices and shaping the future of sustainable transportation in the United States.

Source: Visual Capitalist

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