Want to buy an expensive electric car? Here’s why the state won’t be giving you a rebate
If you’ve been thinking about buying a pricey electric car in California, you’d better get on it soon if you’d like to get a rebate from the state.
Last month, the state agency that manages California’s electric vehicle rebate program announced that beginning Dec. 3, it was going to discontinue rebate programs for new electric cars that cost more than $60,000 and for plug-in hybrid cars that can only travel 35 miles on a single charge.
The agency also is reducing rebates for higher-income buyers for some hybrids, zero-emission motorcycles and vehicles with fuel cells, and limiting the number of rebates Californians can receive to once per lifetime.
The move by the California Air Resources Board is an effort to shift rebates from wealthy car buyers to the less affluent while ensuring the program has enough funds to keep handing out money over the upcoming fiscal year.
“This demand exceeds the current program budget,” CARB spokeswoman Melanie Turner said in an email. “The recent changes were made to ensure that this year’s funding allocation provides a meaningful incentive to encourage electric-vehicle purchases while maintaining a viable program for a longer portion of the upcoming year.”
In October, CARB approved a $238 million clean-vehicle rebate budget, which includes $25 million for rebates for lower-income buyers.
As part of those changes, rebates for fully electric vehicles will drop from $2,500 to $2,000 on Dec. 3. Rebates for plug-in hybrids and fuel cell vehicles also will be reduced by $500.
Will electric car sales slump?
People with lower incomes still qualify for current rebates, such as $7,000 for a new fuel cell electric vehicle.
The program also cuts the number of times a person can receive a state rebate from two times in his or her lifetime to one.
Assemblyman Phil Ting, D-San Francisco, said he was disappointed by the changes, especially since a federal tax credit for cars such as the Chevy Volt and the Telsa Model 3 is going away, which he said will hurt sales.
He said California only has 600,000 electric vehicles on the road today, well short of the state’s goal of putting 5 million on the road by 2030.
“I think the rebates should be going up not down,” Ting said. “I think we should be bolder. Climate change is real. ... If we want clean air, we need clean cars. We have to do everything possible to move people out of dirty cars into clean cars as soon as possible.”
But Jessica Caldwell, an auto industry analyst at Edmunds, said she doesn’t expect the changes in the rebate program to cause electric vehicle sales to slump because the people buying them tend be wealthy anyway. For those buyers, the incentive of a comparatively small rebate isn’t driving their decisions, she said.
“I don’t think this is going to have a big impact,” she said. “I think people that have identified themselves as battery-electric owners, it’s something they strongly identify with, and this isn’t going to necessarily deter them from purchasing that vehicle.”
Since 2010, CARB has approved 354,064 rebates totaling $809 million.
