Since Toyota has already sold 200,000 electric vehicles, the $7,500 federal tax credit is no longer available to its consumers.
Toyota has joined Tesla and General Motors in the club of makers having sold more than 200,000 electric cars to American customers.
However, the bad news is that customers who want an electric Toyota will have to cough out extra cash.
In the US, customers can receive a federal tax credit of up to $7,500 if they purchase an eligible electric or plug-in hybrid vehicle. The tax credit is decreased to $3,750 for the following six months after the manufacturer sells over 200,000 of these vehicles, and then it is cut to $1,875 for an additional six months. Therefore, it’s not the end of the road per se, but it still means that the price of purchasing a Toyota EV has increased.
Toyota’s timing could not be worse as it largely sold plug-in hybrids to fulfill its EV sales cap. The loss of the tax incentive comes as Toyota pushes up sales of the bZ4X, its first battery-only EV.
The bZ4X is at a tricky disadvantage since it is very similar to the Subaru Solterra which was already less expensive. Now since the Solterra comes with a full $7,500 bonus attached, it becomes a much better deal than it’s Toyota counterpart.
The Biden administration proposed to offer a further $4,500 tax credit for the purchase of an electric vehicle (EV), but only from a unionized automaker, which would benefit GM but eliminate Tesla and Toyota from the competition.