GM Introduces $7,500 Incentive in 2025 to Offset Lost EV Tax Credits Under New US Regulations
Discover how General Motors is offering a $7,500 incentive to electric vehicle buyers affected by the latest US Treasury Department rules restricting tax credits on EVs with Chinese-made parts.
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Essential Highlights
- General Motors (GM) announced a $7,500 incentive for EV buyers who lost eligibility for government tax credits due to new Treasury Department regulations effective January 1, 2024.
- Except for the Chevy Bolt, GM’s electric vehicles currently do not qualify for the $7,500 federal tax credit because of components sourced from restricted countries.
- GM plans to adjust its supply chain to ensure future EV models meet the updated tax credit requirements.
On Wednesday, General Motors' stock experienced a 1.8% drop amid the announcement of a $7,500 incentive program aimed at compensating buyers of EVs no longer eligible for federal tax credits under the Inflation Reduction Act of 2022.
This legislative update targets reducing reliance on Chinese and other foreign components in US-manufactured vehicles, impacting GM’s lineup except for the Chevy Bolt.
GM committed to providing dealerships with incentives equivalent to the lost tax credits, enabling dealers to extend these benefits directly to customers.
The automaker highlighted that only two parts in its Cadillac Lyriq and Chevy Blazer EVs fall under the restricted categories. GM anticipates supply chain modifications will soon restore these models’ eligibility for tax credits. Additionally, upcoming models like the Chevy Equinox EV, Chevy Silverado EV, GMC Sierra EV, and Cadillac OPTIQ produced post-regulation change are expected to comply with the new standards.
Despite the stock dip to $35.40 per share by early afternoon trading, GM has seen a 4.7% increase over the past year, reflecting investor confidence in its transition strategy.
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