We looked at the price of a new Chevy Bolt this week and compared the prices before and after the new tax bill was passed and signed into law. We found that the Bolt was about $7,500 less expensive before the new law. We used pricing from the same dealership for the same Bolt trim level in a ZEV state that is one of the most EV-friendly in the country.
Related Story: The New Federal EV Incentive Plan In a Nutshell
When it comes to tax law, the U.S. government seems to have good intentions that somehow always go sideways before the bill becomes law. Case in point, the new EV tax law passed this week. It reduces the number of EVs that will be eligible for the credit, rather than expand the model list as EVangelists envisioned. It also controls which models can and cannot be part of the “free government money” program using a method guaranteed to cause more confusion.
The general ideas of the EV tax bill were that it would:
-Make EVs more affordable during a period of very high inflation.
-Increase consumer demand for EVs.
-Reward automakers who build EVs in the U.S.
-Reward unions who the new President credits with being instrumental in his re-election.
-Create a way for the individuals and families most likely to be able to afford a new car to pay more for that car than other shoppers.
Let’s focus primarily on three of the five main goals. Those that intended EVs would be more affordable, reward companies that make EVs in the U.S., and funnel money back to unions that helped fund the President’s election campaign via union dues.
Chevy Bolt Prices Then and Now
In March of 2021, the Chevrolet Bolt had no federal tax incentive. It was selling in Massachusetts at an EV-friendly dealership called Quirk. We know the pricing because the nonprofit Drive Green Program publishes the prices for EVs in Massachusetts online. The price at that time, without the federal incentive for a Bolt LT was $17,495 inclusive of a state rebate. The reason the Bolt was so inexpensive was that GM was discounting Bolts by $17,500. You heard that right; GM was selling Bolts at half of its imaginary MSRP. The price is shown below.
Leading up to the passage of the bill, General Motors changed its pricing and its incentives. Today, a week following the law’s enactment, the same Bolt, but in the current model year, now has a cost to the same consumer of $24,995. We plugged these two numbers into our Bat Computer and discovered that after the passage of the bill intended to make EVs more affordable, the cost to the consumer went up. By $7,500. You can see the most recent price below.
Made In America Gone Wrong
The Chevy Bolt is built at the Orion Township Plant in the great state of Michigan. The state called Michigan is part of the United States and has been since 1837. The new tax bill did not reward GM for making this battery electric vehicle inside our borders. In fact, it is excluded from the new free government money program for this year of 2022. How do we know it is excluded? We checked two sources. First, the IRS website, and second, Devan, the friendly salesperson at Quirk, who verified all of our facts related to pricing that we found on the Drivegreen Website on August 22nd. Apparently, the goal of rewarding automakers for building EVs inside of our country is unmet, at least for the all-American Bolt.
Union Funding Goes Un-repaid
On August 1st, 2021 at an event that brought most EV makers to the White house aside from Tesla, President Biden thanked Unions for their support, saying, "I just want to be very straightforward. You know, UAW 'brung me to the dance,' as they say." The Orion plant is unionized. The union that represents its workers is the United Auto Workers (UAW) Local 5960. The workers at this plant have not recouped the union dues that they pooled together to help elect the President so that he could reward them by using taxpayer dollars to subsidize the product they build. This goal has gone unmet.
Lobbyists Warn This New EV Incentive Law Only Gets Worse
John Bozzella, a lobbyist for many of the world’s largest automakers, warned this new tax law would not help but hurt electric vehicle adoption. Mr. Bozzella told Reuters prior to the law’s passage that the bill will not just hurt EV shoppers now, but when the law’s later stages kick in. Speaking of the EV models being made by brands such as GM and Ford, he said, "None would qualify for the full credit when additional sourcing requirements go into effect."
Automakers and EVangelists alike have been lobbying Congress to provide more and better taxpayer funding for EVs to achieve a long list of goals. The Bolt is just one example helping to illustrate how well the goals were met. The new law replaces a prior EV tax incentive law that was in place during both the Obama and Trump administrations.
Image of Chevy Bolt by John Goreham. Price listings courtesy of Drive Green.
John Goreham is a long-time New England Motor Press Association member and recovering engineer. John's interest in EVs goes back to 1990 when he designed the thermal control system for an EV battery as part of an academic team. After earning his mechanical engineering degree, John completed a marketing program at Northeastern University and worked with automotive component manufacturers, in the semiconductor industry, and in biotech. In addition to Torque News, John's work has appeared in print in dozens of American news outlets and he provides reviews to many vehicle shopping sites. You can follow John on TikTok @ToknCars, on Twitter, and view his credentials at Linkedin
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