GM is offering a $7,500 incentive for EVs that lost eligibility for the EV tax credit. This comes after several GM electric models were excluded, starting this week.
GM to give $7,500 incentive for non-qualifying EVs
Two weeks ago, GM said the new Chevy Blazer EV and Cadillac Lyriq would lose eligibility for the US EV tax credit at the beginning of 2024.
According to GM, the setback is only temporary due to “two minor components” in the EV models. However, no other specifics were mentioned.
The company said all other EVs under the price cap would qualify, leaving only the Chevy Bolt EV, which is scheduled to end production. GM’s other electric models, including the GMC Hummer EV, start well over the $80K threshold for SUVs and pickups.
Following a sourcing change, GM expects new EVs, like the Chevy Equinox, GMC Sierra Denali, and Cadillac OPTIQ, to qualify for the full $7,500 incentive.
Until then, GM will fill in the gap for buyers. GM told dealers it would give the same EV tax credit incentive “for any vehicles that became ineligible to the new guidelines.”
The news comes as additional restrictions were put in place for EVs to qualify. Electric models with battery components from a “foreign entity of concern,” like China, lost eligibility on Jan 1st. Following the changes, only 13 EVs qualify for the credit in 2024.
Other EVs that lost eligibility include the Tesla Model 3 RWD and LR, Volkswagen ID.4, Ford Mustang Mach-E, and Nissan LEAF.
Tesla confirmed all Model Y variants will retain access to the full $7,500 tax credit. The changes allow you to claim the credit at the point of sale (at participating dealers) rather than waiting to claim the credit on your tax return.
Despite delaying production of several EVs, including the Equinox, Silverado RST, and GMC Sierra Denali, GM doesn’t want to fall further behind as the industry transitions to electric.
Tesla’s Model Y, the best-selling vehicle globally, still qualifies for the full credit. The EV leader just broke another sales record with 1.81 million EVs sold last year, up 38% from 2022.
Ford’s F-150 Lightning became the best-selling electric pickup after a record Q4. Meanwhile, overseas automakers like Hyundai and Volvo expect a big year with highly-anticipated EVs like Volvo’s EX30, starting at $35,000, rolling out.
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