Tax Credit Hope!

Tax Credit Hope!

Guys check out what I just read ! Those who are "tax savvy" is this true from your understanding?

"The current federal incentive program does not have an expiration date, but it is designed to give all carmakers an equal incentive to build and sell plug-in electric vehicles for a limited amount of time. Whenever a manufacturer reaches 200,000 PEV unit sales in the United States, the tax credit goes into its “phaseout” period, which lasts somewhere between 15 months plus a day or 18 months minus a day. Huh?

It can be a little confusing, but the way it works is that whenever a manufacturer hits car #200,000 sold in the United States, any EV that company sells in the US during that calendar quarter and the following quarter qualify for the full tax credit. So if Tesla delivers its 200,000th car on July 1, 2018, then all of the cars its sells in the United States from July 1 to September 30 (Q3) and from October 1 to December 31 (Q4) qualify for the full tax credit. After that, for the next six months (two quarters) the credit decreases to 50% ($3,750); then decreases to 25% ($1,875) for the following six months."

CoreDump | 09. Februar 2017

I think you are correct in how it works, but you have to take into account that Tesla has already sold ~110000 S and X in the US. Only US sales count for the 200,000 limit.

US sale found here:

I don't know how accurate it is, but you I would guess that they will have sold 200,000 EVs in the US before July 1, 2018. My guess is that they will have sold 200k S and X by then, not counting any M3. Though this depends greatly on how quickly they can ramp M3 production.

I know that Elon has stated that he wants people to be able to take advantage of the credits, so they might be planning for production to go from 0 to 40,000 cars a month very quickly and fulfilling US orders first. That way, the first 500,000 or so cars have a shot at least $3,750. My point being that production MUST ramp faster then then it did for S and X. A much simpler car, more experience and engineering/automation talent added recently should make the ramp up more possible then it has been in the past.

dsvick | 09. Februar 2017

Yes, that article, from almost a year ago, is correct in how the tax credit works. If you do a search on it there are any number of other, more recent, articles making guesses at when they'll reach number 200,000. The current consensus seems to be the last quarter of 2017 or the first quarter of 2018. Much of the difference is based on how quickly they can ramp up Model 3 production. Be on the lookout for more of them after the call on the 22nd and after the call for each quarter this year.

PhillyGal | 09. Februar 2017

Yes, and I'd place a bet that Tesla will do whatever possible to make it 18 months minus a day rather than 15.

eg: if the 200,000th sale in the US is fixing to occur at the end of a quarter, they'll hold off on the sale until the first day of the next quarter.

Red Sage ca us | 09. Februar 2017

Yes. And that would be a 'calendar quarter' for best effect. The count is not per vehicle model, but by manufacturer for eligible qualifying vehicles offered for sale/lease in the U.S.

Haggy | 09. Februar 2017

"if the 200,000th sale in the US is fixing to occur at the end of a quarter, they'll hold off on the sale until the first day of the next quarter."

Or to put it another way, they will make somebody in Australia or somewhere else a little bit happier that they decided to add a few weeks of RHD production to the end of a quarter.

Stock analysts won't like it, because even though it would mean just as many sales, it would defer some revenue to the following quarter. Making cars in that same period destined for California pickup and then starting the next quarter with cars that will make it to Australia easily before the end of the quarter would look better on paper. It won't affect annual sales numbers unless that quarter is at the end of a calendar year, in which case analysts will have a fit over nothing.

cbaum133 | 09. Februar 2017

I love that Tesla is such a trusted company that their customers are expecting the very best from them.

Efontana | 10. Februar 2017

When does the India market open?