Breaking News: GM's EV Push Costs $1.6 Billion as Tax Credit Ends
General Motors will take a $1.6 billion hit to its balance sheet when it reports its Q3 results later this month, due to the end of the clean vehicle tax credit on September 30.
The automaker had hoped to capitalize on the remaining credits, but instead saw a surge in EV sales as customers rushed to dealerships before the deadline. GM's electric vehicle sales are up 104% for the year to date, with nearly 145,000 units sold.
Timeline:
Q3 was a strong quarter for GM, with sales up 8% year on year and 10% for the year to date.
The clean vehicle tax credit expired on September 30.
GM's EV sales have been driven by demand for electric Cadillacs, Chevrolets, and GMCs.
Immediate Impact:
The loss will be reflected in GM's Q3 financials, which are set to be released later this month. The company has not yet commented on how it plans to mitigate the impact of the tax credit's expiration.
Background Context:
The end of the clean vehicle tax credit was a result of efforts by the Trump administration and congressional Republicans to repeal or limit EV incentives. Despite this, GM had continued to invest in its electric vehicle lineup, including the popular Cadillac Lyriq and Chevrolet Bolt.
What Happens Next:
As the US market adjusts to the end of the tax credit, automakers will need to reassess their product portfolio plans and pricing strategies. GM's decision to absorb the $1.6 billion loss may indicate a commitment to its EV strategy, but it remains to be seen how other manufacturers will respond to the changing landscape.
*This story is developing. Information compiled from Arstechnica reporting.*
