- Toyota has finally launched a consumer battery electric vehicle — the bZ4X — just as it’s about to trigger the phasing out of the federal EV tax credit.
- Toyota has sold 200,000 vehicles thanks to strong sales of its plug-in gas-electric hybrids (Prius Prime and RAV4 Prime).
- If you’re interested in the RAV4 Prime or the bZ4X, you should still be able to get the full $7,500 in credit until October of this year.
Toyota has long been doing big things with the Prius name, which means “forward.” When it comes to electric vehicles, however, Toyota is in third place, at least when it comes to reaching the ceiling of the federal tax credit for electric vehicles and plug-in hybrid electric vehicles (PHEVs).
According to the data, 183,000 Toyota EVs and PHEVs were eligible for the federal tax credit at the end of 2021, and an additional 8,421 vehicles were added to the registry by the end of the first quarter of 2022. car newsAt that rate, Toyota expects to use up those full credits — capped at 200,000 per automaker — sometime before the summer, and then begin tapering the deductions over a year. Once Toyota hits that threshold, its new EV and PHEV buyers will be able to receive a tax credit of half the maximum amount for six months, followed by a quarter of the original amount for another six months. Afterwards, Toyota EV and PHEV consumers will be required to purchase these vehicles without federal tax incentives.
“We expect that to happen because Tesla has pulled out and GM has pulled out, and we’ll probably see it in the second quarter,” said Bob Carter, Toyota’s executive vice president of North American sales. car news. “When you exit, you go into a phase of tapering, so we’re looking forward to that. »
On the one hand, reaching this milestone is a good thing for Toyota. After all, that means the brand has managed to sell 200,000 fully electric and partially electric vehicles. On the other hand, it’s a bad time for Toyota to look down on the phasing out of tax credits.
The brand is currently launching its first purpose-built battery-electric model in the U.S. (Toyota sold early EVs in the 21st century limited to certain states), the bZ4X. As a result, only a small percentage of initial buyers will be able to take advantage of the full $7,500 credit for which the vehicle is eligible.
Thanks to more than 10 years of Leaf sales, Nissan is in a similar position to launch the Ariya electric SUV.Carter says car news That Toyota is considering lowering the starting price of electric vehicles in response to the expiration of its federal electric vehicle tax credit.
If Toyota does reach the 200,000-vehicle level in the second quarter (before July 1), all sales through the end of October this year will still be eligible for the full credit. However, in November, the credit will drop to $3,750 and then to $1,875 on April 1, 2023, meaning Toyota could hit the federal EV tax credit cap by October 2023.
While just officially entering the EV arena, Toyota’s popular Prius and RAV4 PHEV models have successfully crossed the brand’s 200,000 electric and partially electric vehicle sales milestone. Because of these models’ smaller batteries, the 2012-2015 Prius Plug-in is eligible for a $2,500 tax credit, while the 2017 and newer Prius PHEVs receive a $4,502 credit. Meanwhile, the RAV4 got the full $7,500 back…for now.