If you’ve been on the fence about ordering a new Tesla, your indecision could cost you as the company’s fleet of electric vehicles is no longer going to be eligible for the full $7,500 federal tax credit in the United States.
As a result of a law passed last year, the tax credit will be reduced once an automaker sells 200,000 electric vehicles. Tesla hit the mark in July, but Reuters notes the rebate reduction doesn’t kick in instantly and all vehicles delivered by the end of the year will remain eligible for the full rebate.
However, Tesla set a deadline of today (October 15th) for orders to be placed so that vehicles will arrive before the end of the year. Since the rebate will be reduced by 50 percent every six months, customers who take delivery of a new Tesla beginning in January will only receive a credit of $3,750. Six months later, in July of 2019, the rebate will only be worth $1,875.
Unfortunately, the full rebate won’t be available to customers who could likely use it the most – buyers of the entry-level Model 3. The car is slated to start at around $35,000 which means the full $7,500 rebate would have effectively lowered the price to $27,500. However, the entry-level Model 3 has been continuously delayed and Tesla’s timeline shows the car isn’t expected to be available until next year.
The delay could damper future Model 3 sales as competitors such as the Chevrolet Bolt and Nissan Leaf are still eligible for the full tax rebate. Tesla doesn’t just have to worry about low end sales either as the rebate reduction comes at a time when Audi, Jaguar and Mercedes are taking aim the Model X. Porsche, on the other hand, is going after the Model S with the Taycan.