Greg Gardner

Detroit Free Press

A threat to wipe out all incentives for electric vehicles was dropped by congressional conferees in the $1.5 trillion tax overhaul signed Friday by President Trump, advocates say.

"The tax credit for plug-in electric drive vehicles remains intact," said Genevieve Cullen, president of the Electric Drive Transportation Association in Washington, D.C.

The credits are available on the first 200,000 electric vehicles a manufacturer sells. Once a company reaches that threshold, the $7,500 income-tax credit continues through the end of that calendar quarter.

Then it is reduced by 50% every six months until it phases out completely.

While some observers had argued that tax credits don't influence affluent buyers who can afford $80,000 to $120,000 for Tesla Model S or X, it can be a decisive factor for newer EVs such as the Chevrolet Bolt and Tesla Model 3 that are trying to keep the sales price to about $30,000 after the credit.

Most automakers are pleased.

"We support any kind of incentive that could convince consumers to purchase electric vehicles," said Gloria Bergquist, vice president of the Alliance of Automobile Manufacturers, the industry's chief lobbying group.

Last week, General Motors CEO Mary Barra repeated her support for the provision because "repealing that credit will have an impact because it changes the equation that determines whether people want an electric vehicle."

GM issued a statement saying it was pleased the EV credit stayed in the bill.

CALSTART, a nonprofit representing 175 companies working on some aspects of electric vehicle technology, also lobbied to keep the incentive.

"The credit protects U.S. job creation and leadership in the electric vehicle sector," CALSTART said in a statement.

U.S. Department of Energy research found that more than 215,000 jobs in the U.S. are devoted to electric drive vehicle and component manufacturing.

Current law says that consumers who buy or lease a vehicle with a battery capacity of at least 4 kilowatt-hours qualify for a tax credit of between $2,500 and $7,500.

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Gasoline-electric hybrids that don't require charging are not eligible.

General Motors, Tesla and Nissan would have been hurt the most because they have sold more plug-in electric vehicles in the U.S. than their competitors.

In June 2015, Georgia ended a $5,000 state income tax credit for EV buyers and imposed a $200 registration fee. EV sales in the Peach State plummeted about 90% over the next six months.