CT does or does not qualify for the $7,500 Federal Tax Credit as of 1/1/24?

[Old Pro]

Did I read correctly that the CT will not qualify for the $7,500 Federal Tax Credit. LA Times article on 1/3/24 I believe.

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[scottf200]

It does not for the new POS (point of sale)

 

[Crissa]

Well, right now it's too expensive - the founder's edition - to qualify.

-Crissa

 

[Jhodgesatmb]

Did I read correctly that the CT will not qualify for the $7,500 Federal Tax Credit. LA Times article on 1/3/24 I believe.

Currently there is no Cybertruck selling for under $80K, so no.

 

[Old Pro]

Currently there is no Cybertruck selling for under $80K, so no.

Is that the only basis or is it the battery?

 

[Crissa]

Is that the only basis or is it the battery?

There's:

1. Sold new, by a licensed retailer.
2. Battery manufacture location.
3. Critical mineral composition.
4. Price level.

As far as we know it qualifies #1-3, and will eventually cover #4. The cells are made in the US! But we don't know their critical mineral composition currently.

-Crissa

 

[Jhodgesatmb]

Is that the only basis or is it the battery?

All Cybertruck batteries are made in Austin or Fremont, but that doesn’t come into play unless the price is below the threshold- so a moot point.

 

[Jhodgesatmb]

There's:

1. Sold new, by a licensed retailer.
2. Battery manufacture location.
3. Critical mineral composition.
4. Price level.

As far as we know it qualifies #1-3, and will eventually cover #4. The cells are made in the US! But we don't know their critical mineral composition currently.

-Crissa

Right except that number 4 is the gateway, so the others don’t come into play if the price is above the threshold. Also, by critical mineral composition you mean the source, right, as they must source from free trade countries.

 

[Old Pro]

So, to try and find a little bit clearer picture. 1) $80,000 is the max price to qualify for the $7,500 Federal Tax Credit? 2) A CT under the max price set by the Feds WOULD QUALIFY for a Federal Tax Credit?

 

[Crissa]

So, to try and find a little bit clearer picture. 1) $80,000 is the max price to qualify for the $7,500 Federal Tax Credit? 2) A CT under the max price set by the Feds WOULD QUALIFY for a Federal Tax Credit?

1. Yes.
2. We think so, but don't know.

For instance, not all their US-made 2170s met the critical minerals test. Their LFP cells are Chinese-made and don't qualify at all. We know some of their minerals in Texas come from Australia, but it's hard to know from the outside.

-Crissa

 

[Jhodgesatmb]

So, to try and find a little bit clearer picture. 1) $80,000 is the max price to qualify for the $7,500 Federal Tax Credit? 2) A CT under the max price set by the Feds WOULD QUALIFY for a Federal Tax Credit?

1) Yes, 2) It would depending on the source location of battery anode and cathode materials, but most likely yes.

 

[fdon1]

Well, right now it's too expensive - the founder's edition - to qualify.

-Crissa

If there is no way around this then either FS will depreciate quick or FS might hold value if there are only a few or even 1k

 

[cvalue13]

If there is no way around this then either FS will depreciate quick or FS might hold value if there are only a few or even 1k

there is no way around it

and this should have been clear to anyone once the pricing went live for either both Foundation trims, or the retail beast trim.


Though I do sometimes forget that the Tesla crowd hasn’t for some time paid as close attention to the credits as the rest of us have.

the Lightning crowd in particular, during first year production and while the new regime was being proposed/amended/passed, we’re forced to get agile or be left totally confused

But it’s settled law and process now


as for the suggestion that because of the credits the FS would depreciate more quickly because of this, however, is a bit unclear. except for those not paying attention, the FS AWD was always priced at an effective $27,500 more than A RETAIL AWD for someone who otherwise qualifies for the credit.

but the retail Beast never qualified, and the retail AWD wouldn’t qualify for anyone who didn’t qualify for the credit in the first place (due to income caps, etc.).

Meanwhile, when it comes to the AWD Foundation unit: someone who qualifies for the credit based on income, is already YOLO’ing financially to decide to buy a $100K highly depreciating BEV asset - especially in this interest environment.

Hell, they’re YOLO’ing enough to reach for a $79K highly depreciating asset.

Long story short: that no CT trim currently offered qualifies for the credit boils down to the following small bucket of relevance:

Those who qualify for the credit in the first place (based on income), considering an AWD model, and deciding between a regularly YOLO of $79K vs a hyper-YOLO of $100K.

I’d argue that *should* be a relatively small bucket (though never underestimate the American’s willingness to YOLO for a vehicle).

 

[Woodrick]

If you get the opportunity to order a Foundation vehicle, Tesla's guidance is there.

If not, let them sell one to a customer and we'll see.

There's still discussions going on in DC that may change it.

 

[tenetke]

That federal tax credit isn’t the only one available. Either trim for the FS is eligible for the CCV $7500 credit.

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