GM hits 200K cap for EV tax credit
General Motors Co. is the second automaker to sell 200,000 electrified vehicles, reaching the cap for a $7,500 federal tax credit designed to encourage EV sales.
The Detroit automaker said it sold the 200,000th electric vehicle in the fourth quarter of 2018, reaching the milestone eight years after it released the plug-in hybrid Chevrolet Volt. Reaching the cap begins a phasing-out process of the EV tax credit for GM buyers, which will now reduce by half every six months until it hits zero.
Tesla was the first automaker to sell 200,000 EVs, hitting the limit in July.
The phasing out of GM's EV tax credit comes as the automaker prepares to release a more robust lineup of zero-emission vehicles. The Detroit automaker said in 2017 it would release 20 new battery-electric or fuel-cell vehicles by 2023.
GM's battery-electric Chevrolet Bolt, released in 2016, has become the platform for the autonomous vehicle developed by GM Cruise LLC in San Francisco. The zero-emission, driverless vehicle is a symbol of GM's vision of a future with "zero crashes, zero emissions and zero congestion."
At the same time, EV adoption by U.S. car buyers continues to lag. Last year electric vehicles made up just under 1 percent of the U.S. car market. That's expected to increase this year, but still will likely only represent about 2 percent of the market.
As Tesla's tax credit dwindles, the electric car-maker is slashing prices of its vehicles by $2,000 to offset the reduction in the $7,500 federal tax credit.
For GM, the Bolt alone saw sales decrease 22.7 percent in 2018, the first full year the vehicle was available nationwide. The plug-in hybrid Volt saw sales slip 10 percent. As GM looks to restructure its business and slash cost, the Detroit automaker is stopping production of the Volt this year.
GM CEO Mary Barra has called for an expansion of the EV tax credit, the automaker's best tool for luring new buyers of the zero-emission vehicles as cost and lack of charging infrastructure continue to stand as the most prominent barriers to adoption.
President Donald Trump recently threatened to cut GM's EV tax credit in retaliation for the company's plans to idle four U.S. plants, cut 8,000 salaried employees and threaten the jobs of 3,300 hourly workers in three states.