If you’re planning on getting a Tesla Model 3, Model S or Model X, you better act soon, since the $7,500 federal tax credit for all Tesla vehicles is about to expire. It’s expected that Tesla will pass the 200,000 sales mark soon, which will reduce the tax credit for its vehicles.
In easier terms, basically once Tesla sells more than 200,000 vehicles, all of its vehicles are about to get more expensive, since buyers will no longer be able to apply for the full $7,500 credit. This is bad news for the 400k+ individuals who reserved the Model 3, since they will likely receive it after the $7,500 credit expires.
When will Tesla pass the 200,000 mark? Alan Baum of Baum & Associates recently told Car and Driver that Tesla could reach the 200,000 mark in early 2018, if not sooner. Once the $7,500 credit expires, buyers will then only be eligible for 50 percent of the original credit ($3,750) for up to a year. Then during the following two quarters, the credit will be reduced to 25 percent ($1,875). This means that in 2018 buyers will likely only get a $3,750 credit and in the first two quarters of 2019 they will only get $1,875.
By mid-2019 Tesla vehicles will no longer be eligible for a federal tax credit.
If you’re looking at rivals, like the Chevy Bolt or Nissan Leaf, you’ll be happy to hear that both automakers will have the full $7,500 credit in 2018.
Source: Car and Driver