Tesla No Longer Needs the EV Tax Credit
A while back, I wrote about how the EV tax credit bill would take Tesla "to the moon". Well, it turns out that simply the demand for Tesla vehicles is taking Tesla, as a company, to the moon. This is an expression that Tesla is growing fast and will be worth a lot.
Elon Musk stated very clearly in an interview with the Wall Street Journal that the Build Better Back Bill should be killed completely - "DELETE" is what Elon Musk said. And he's right. The demand for Tesla vehicles is staggering. Here's what the demand is for Tesla vehicles, just from their website, is in the U.S.:
Tesla Demand (range dependent on specifications like tires, etc...):
Model S, Dual-Motor AWD (6 to 10 months, 2022)
Model S Plaid (4 to 8 weeks)
Model 3 RWD (5 to 9 months, 2022)
Model 3, Long Range (2 months)
Model 3 Performance (2 months)
Model Y Long Range (7 to 11 months)
Model Y Performance (2 months)
Not to mention, there's around 2 million Cybertruck pre-orders.
Note, the Model S Plaid is Tesla's most expensive vehicle by far, starting at $124,490. This is out of the price range of most U.S. citizens, yet there still is a 1 to 2 month wait for it. Most of Tesla's other vehicles that are more expensive have shorter wait times as well.
This should make it obvious that there is a direct correlation between the price of a vehicle and the demand for it. As price goes down, demand goes up. As price goes up, demand goes down.
The two best sellers are easily the Model 3 RWD and the Model Y Long Range. With these wait times, Tesla doesn't need any more pressure to raise prices, which is exactly what they would have to do if the EV tax credit bill passes. This would put Tesla vehicles further out of reach for the average person.
Will the Bill Pass?
I'm skeptical that the BBB will pass - even if it's just the EV tax credit, I don't think that will pass. The U.S. just has too much debt on its hands. In order for things like this to happen, the U.S. is going to have to show that it can bring down its debt load - otherwise all programs will start to become out of reach.
In a strange sort of way, Elon Musk is doing all the things that the government should be doing, except he is doing it in the private sector. He is bringing renewable energy to the masses. He is creating green energy electric vehicles and energy storage. He's building reusable rockets.
The government is providing little value when it comes to doing these things and Tesla is leading the way.
To sum up, I don't think any bill is going to pass at all anymore. I thought it would last year, but not anymore. It's just to expensive for the U.S.
Does Tesla need the EV tax credit bill to be successful? What about other companies like GM and Ford? Will the bill pass?
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Jeremy Johnson is a Tesla investor and supporter. He first invested in Tesla in 2017 after years of following Elon Musk and admiring his work ethic and intelligence. Since then, he's become a Tesla bull, covering anything about Tesla he can find, while also dabbling in other electric vehicle companies. Jeremy covers Tesla developments at Torque News. You can follow him on Twitter or LinkedIn to stay in touch and follow his Tesla news coverage on Torque News.