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Is California Bailing Out Tesla through the Backdoor?
- BoorishBears 9y agoSo if a P100D has the 0 to 60 of an exotic, but all the interior fit and polish of a base trim CLA, taxpayers should... cover the difference in price to a CLA? There has to be something missing here.
- JumpCrisscross 9y agoNope, you got it. Small group of people get to decide which products get how much in subsidies, and by extension, which companies get how much taxpayer money. Also, since it's a per-vehicle subsidy, it rewards large companies over small ones. (Not to mention wealthy consumers over poorer ones.)
- Fricken 9y agoWow, if they're giving that much away to EV buyers, just think how much they'll hand out to people who walk to work!
- givemefive 9y agoyeah as someone that bikes 25 miles per day for commute it kinda bothers me how many tax breaks are given to other forms of commute like trains, buses, vansharing, EV, etc.
- 2bluesc 9y agoI bike as well and never thought of this. Now, I'll never be able to forget it.
- givemefive 9y agoNever really noticed it until I started a new job and they were pitching all these federal and company commuter benefits and didn't see a single one for bikes. But hey.. my work has a nice locker room that makes biking possible so it's not all bad! I also ride about half the way on bike paths under high voltage lines so I do get some benefits :)
- maxharris 9y agoOne solution is to simply treat everyone equally and not give anyone a tax break. I know this is not what most people think, but in the context of good governance, my view is that no (legal) behavior is any more or less meritorious than any other.
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- PhasmaFelis 9y agoThere are lots of perfectly legal things that are bad for everyone if too many people do them (the tragedy of the commons). Trying to reduce bad things happening to citizens is arguably the entire purpose of government.
- kenjackson 9y agoWhy would you think this? For illegal activities there is a hierarchy -- why would there not be for legal activities?
- taneq 9y agoWait, we are talking push-bike here, right? Because subsidies for electric motorcycles should totally be a thing.
- dragonwriter 9y ago> Wow, if they're giving that much away to EV buyers, just think how much they'll hand out to people who walk to work! Well, if you walk (or bike) to work, your public subsidy is not paying gas taxes (and, having the option to not even pay regular sales tax on your fuel.) If your personal vehicle choice is “I walk or bike everywhere, so I don't need a car”, your additional public subsidy is not paying Vehicle License Fee. Sure, those are actually public levies on those making the alternative choice, but that's equivalent to a public subsidy for your choice, just with a shift in what is the baseline case.
- taneq 9y agoIs Tesla in trouble financially? And I mean actual can-no-longer-be-profitable type trouble? That seems an odd call given that they've so far planned pretty comprehensively, and delivered pretty much on their plans, and those plans would have included the existing subsidy ending as soon as they hit higher volumes. The fact that they're hellbent on hitting those higher volumes ASAP indicates to me that they know they'll still be profitable after the subsidies are gone. In fact, they'll probably gain some advantage from the fact, as the only EV manufacturer operating at any kind of volume, because it will raise the barrier to entry for newer, still-lower-volume manufacturers. So yeah, nice windfall for Tesla, but 'bailout' seems somewhat loaded.
- valuearb 9y agoThey raised a ton of money recently to cover the continuing investment they forecast needing to make it to profitability. But they then turned around and bought hemorrhaging Solar City, so it's unclear how long the cash will last and whether it's long enough.
- aphextron 9y agoI don't understand why they are singling out Tesla here. There are currently 4 other large volume production EV's being sold in California (Nissan Leaf, Hyundai Ioniq, Chevy Bolt, BMW i3). EV's make good sense both economically and environmentally for California in the long run, but we still need the tax incentives for the next few years until battery costs come down with new production capacity.
- RodericDay 9y agoTrickle-down environmentalism is not real environmentalism, and the ruse is becoming clearer by the day.
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- valuearb 9y agoBecause the benefits of the subsidy are disproportionately given to companies that exhaust federal subsidies. And Tesla will be the only one to do that for some time. EV's don't make good sense "economically" for California yet. It's not unreasonable to wait until battery costs come down so mass adoption comes naturally. They do make sense environmentally, but there is a far better way to compensate them for the actual value of their environmental benefit rather than a politically decided subsidy. California is already discussing doing it's own Cap and Trade market. Instead of subsidizing "zero emission" cars, it creates a market cost for carbon emissions, and raises the prices of gas engined cars, and not just newly purchased cars, all cars. And it's fair, if your Tesla gets all of it's electricity from coal fired plants, you'll pay your fair share for that plants emissions.
- cybernytrix 9y agoWhat about the carbon emissions in order to manufacture the car, dig up mines for lithium etc? Surely that needs to be accounted as well.
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- _jezell_ 9y agoIt's hardly a "bailout" when Tesla generates more revenue for the state than these tax credits are worth. The sales tax alone on many of the current models exceeds this tax credit.
- JumpCrisscross 9y ago> Tesla generates more revenue for the state than these tax credits are worth California collects a 7.5% sales tax on the purchase of new vehicles [1]. A $40,000 car would thus generate $3,000 of state sales tax income. That appears to be much less than the value of the proposed credits. [1] https://www.salestaxhandbook.com/california/sales-tax-vehicles https://www.salestaxhandbook.com/california/sales-tax-vehicl...
- _jezell_ 9y agoAs I said, current models. Those are future models. And this is not the only revenue the state gets from Tesla.
- DrScump 9y agoAnd even then, absent the existence of Tesla, similar money would be spent on a competing vehicle anyway.
- lazyjones 9y ago> A $40,000 car would thus generate $3,000 of state sales tax income. That appears to be much less than the value of the proposed credits. Tesla sells expensive cars, revenue per car is currently near $90.000.
- dragonwriter 9y agoThe Business Insider piece sourced it's information on what the bill does not on the bill text, but on a combination of an advocacy email from an opposed legislator and reporting by the Mercury News. The rebate plan does not do at all what the article claims; specifically, for instance, it does not establish a new general rebate that is designed to match the difference between an electric vehicle's price and that of a non-electric vehicle with similar features. Instead, it establishes a declining rebate for compact electric vehicles that starts at an initial level that would provide an approximate net purchase price after all existing incentives equal to the most commonly sold compact vehicle in the State, but where the rebate level would decline with EV penetration by income segment. (Health and Safety Code 44215.4, as added by the bill.) In fact, there was no specific rebate plan in the version passed by the Assembly, which notionally is the subject of the article; there was a requirement for the PUC to adopt incentives. The sources the article relied on (assuming BI doesn't misrepresent then) were either inventing bill content from whole cloth or speculating about what the PUC might do; in any case, the bill has been significantly revised already in the Senate, to address the same broad purpose but to be more specific about program parameters and move the primary administrative responsibility for programs to the Air Resources Board rather than the PUC.
- Someone 9y agoGood to hear, as the way they phrased this was as a blanket invitation for electric vehicle manufacturers to raise prices (if they add $x to their prices, their revenue would go up by $x, but customers wouldn't complain, as they would get $x more rebate)
- dragonwriter 9y agoFYI, in case the reference to Business Insider in the above seems odd, the mods have apparently not only changed the headline to a more clickbait one than it used to be, but also ibexplicably changed the source article from a BI article to a nearly-identical (to the point that if they were turned in in a the same class in school, the putative authors would probably be hauled in to answer questions about plagiarism) WolfStreet article.
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- gfody 9y ago> http://vidak.cssrc.us/content/district http://vidak.cssrc.us/content/district Wow what is it about Visalia and Tulare that would cause something like this?
- woodandsteel 9y agoThe Chevy Bolt got great reviews, and it was supposed to be big competition for the Tesla 3, but so far sales have been disappointing. https://cleantechnica.com/2017/07/18/chevy-bolt-production-ramps-tesla-model-3-production-ramps/ https://cleantechnica.com/2017/07/18/chevy-bolt-production-r... Anybody have an idea why?