Tesla Will Be First Automaker To Lose the Federal Tax Credit For Electric Cars

Tesla has confirmed to Jalopnik that its 200,000th vehicle has been delivered this month, meaning the full $7,500 federal tax credit for electric cars will slowly be phased out. Tesla is the first automaker to reach this mark. "GM is close, too, while Nissan, Ford, and others still have a ways to go," notes The Verge. From the report: Tesla customers who take delivery of their cars -- regardless of whether it's a Model S, X, or 3 -- between now and December 31st, 2018, will still be eligible for the full $7,500 credit from the IRS. Customers who take delivery of their cars between January 1st and June 30th, 2019, will only be eligible for a $3,750 credit. And customers who take delivery of their cars between July 1st and December 31st, 2019, will be offered just $1,875. After that, the incentive is dead.

Put in place early on in the Obama administration, the tax credit was seen as a tool that could be used to encourage customers to buy plug-in electric or hybrid vehicles. This would simultaneously help advance the president's climate and clean energy goals while offering consumers a bit of a break while the cost of battery technology slowly came down. It was also meant to encourage manufacturers to push for greater advancements in that technology. The dollar amount was technically flexible; it was essentially a $2,500 credit with room to increase up to $7,500 depending on the battery capacity of the car being sold. The better the battery in a company's car, the better the rebate their buyers would get.