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Chevrolet Volt
Bush signs bill which grants the Volt a $7,500 tax credit

In mid-September, DailyTech brought you news that congress was working on a new round of tax credits targeted at plug-in electric/hybrid vehicles. The tax credits were projected to weigh in at $3,000 for plug-in vehicles with at least a 6 kWh battery and top out at $7,500.

Toyota, which sells its Prius featuring a 1.3 kWh battery pack, balked at the tax credits as its hybrids wouldn't even qualify for the entry-level tax credit. Toyota also was unhappy that the only vehicle in the near future likely to qualify for the maximum $7,500 tax credit is the Chevrolet Volt.

Despite its opposition, Toyota's fears became law last week when President Bush signed the legislation which passed in the House by a vote of 263 to 171 as a part of the massive $700 billion Wall Street bailout package. The entire 10-year tax package for plug-in electric/hybrid vehicles is worth $1 billion.

Requirements to qualify for the tax credit have changed slightly since its inception in the Senate. The 6 kWh battery minimum dropped down to 4 kWh, while the base tax credit rose from $3,000 to $4,168. The maximum credit remains at $7,500 for the Chevrolet Volt with its 16 kWh lithium-ion battery pack.

The Chevrolet Volt gets its primary power from a 150 HP, 273 lb-ft electric motor. A 1.4 liter gasoline engine is also used to recharge the lithium-ion battery pack once the Volt's 40-mile battery range is depleted. According to GM, the Volt can save customers $1,500 per year in fuel costs based on a daily commute of 40 miles.

The $7,500 tax credit should go a long way towards making the Chevrolet Volt more affordable. Current estimates place the base price of the vehicle at $40,000 or higher.



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Toyota shouldn't complain
By gevorg on 10/5/2008 8:57:43 PM , Rating: 2
$7500 tax credit on a Prius would be almost a third of its price, which is way too much. This will work against the idea that hybrids need to become cost effective without tax credits.




RE: Toyota shouldn't complain
By inighthawki on 10/5/2008 9:50:48 PM , Rating: 2
There inlies the problem, everyone already makes money off of the cars we have today, what incentive do they have to make the earth cleaner? New technology helps but only to those who can afford it, and government tax credits make it easier to embrace a technology which, in the end, is beneficial to everyone and does something about the greedy people who just want more money from oil.


RE: Toyota shouldn't complain
By pattycake0147 on 10/5/2008 10:37:58 PM , Rating: 2
Tax credits would make it easier if they brought the price down to affordable levels. $7500 off a $40k car still leaves it at $32500 which is a bit more than the average person is willing to spend on a Volt. This holds especially true when you can get a Prius at $23k. Ten thousand dollars is a lot of gas. This will only benefit people in the upper echelon that don't need the help in the first place.


RE: Toyota shouldn't complain
By whoisnader on 10/5/2008 10:19:09 PM , Rating: 2
The technology in this car isn't exactly off the shelf and hence 'aint cheep.

Remember that a lot of the technology comes from suppliers (battery included) who are free to strike deals with other manufactures. Once more and more manufactures start engaging these suppliers, you will start to see the price come down as the numbers go up.

The only way to get manufactures to make more cars that use this technology is to make the price affordable to the customer. I still think the price is high but it is better than having to fork out the total cost.
It's not just about the savings of running the car, it is about how much you have to borrow from the bank and loan repayments.

The US government is just trying to stimulate the market as much as it can.


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