Ended Today, Ford And General Motors In Strategy To Keep EV Tax Credit Valid

Photo illustration of the General Motors electric car. (Photo: General Motors)

JAKARTA - US federal tax credit amounting to US$7,500 (around Rp125 million) for leasing electric cars will expire. However, two automotive giants Detroit, Ford and General Motors moved quickly with a clever scheme so that incentives could still be enjoyed by consumers by the end of the year.

It is known that incentives that have pushed for sales of electric cars for more than 15 years will end on Tuesday, September 30, US time.

To help consumers, Ford and General Motors (GM) are currently competing to register their dealers in a new program that will effectively extend the subsidy validity period for consumers who lease EVs.

Reuters reported, quoted Tuesday, September 30, according to dealers and documents in circulation, the scheme of the two companies took advantage of a time gap before the September 30 deadline.

The gap is Ford (Ford Credit) and GM will soon "buy" EVs in the inventory of dealers. They do so by making down payment on the cars.

This down payment meets the requirements for the financing agency to take over a federal tax credit of $7,500 per unit.

Then, after credit is claimed, dealers can still offer customers electric car rentals. The $7,500 subsidy that has been secured by the finance company is then calculated into the rental rates offered to consumers.

In other words, even though the subsidy deadline officially expires, consumers who rent EVs from Ford or GM will still enjoy significant price cuts.

This program is a direct response to concerns widespread in the industry. Executives and analysts predict that EV sales and rentals will plummet after the loss of tax credit.

"We are working with our GM dealer to extend the offer for customers to benefit from tax credit for EV rental," GM said in a statement.

Ford also confirmed similar efforts, stating they were trying to provide competitive rental payments through Ford Credit until December 31.

This clever strategy does not arise without planning. Sources familiar with the discussion mentioned that Ford and GM designed their program after consulting with officials at the Internal Revenue Service (IRS), a US tax agency.