US congressman Mike Kelly, also a car dealer, has asked Congress to end the US$7,500 tax break on electric vehicles (EVs), according to a Michigan newspaper.
The Detroit News reported Kelly said the Chevrolet Volt, General Motors’ plug-in, range extender hybrid, “has become the poster child of President Obama’s failed green agenda.”
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“Like many green initiatives promoted by this administration and bankrolled by the American taxpayer, the electric car is better in theory than in practice; has limited consumer demand; is heavily subsidised; and has fallen short of reaching its targeted goals,” Kelly reportedly wrote.
“Despite the fact that the federal government has no business subsidising a product that a manufacturer could just as easily promote through rebates and other buyer incentives, the tax subsidies are largely going to the affluent few who can actually afford to buy an electric car, which costs anywhere between $40,000 (Chevy Volt) to $97,000 (Fisker’s Karma).”
Kelly also pointed out the average annual income of Volt buyers is $175,000 and a huge percentage of them are from southern California [where many people are notably pro-environment in a state that has tougher current emission laws than most others – ed].
“GM has made some of the finest automobiles known to man. They are master marketers and every product researched, designed and developed was done through rigorous market research and analysis,” Kelly added.
“However, when the model changes, when a manufacturer puts politics ahead of market demand, when the return on investment is measured in terms of political gain rather than financial gain, the results vary drastically.”
In 2008, President George W Bush signed into law a bill granting up to $7,500 tax credits for EVs.
In 2009, Congress expanded the scheme to 200,000 credits per automaker, from 250,000 industry-wide, before it is phased out.
The tax credit is estimated to cost a minimum $1bn.
