Staff Writer
The White House and the Treasury Department this week gathered leaders from the pre-owned vehicle sales industry, clean car advocates, and state and federal officials to discuss the progress spurred by the Inflation Reduction Act’s 25E used clean vehicle tax credit. The event, attended by John Podesta, Senior Advisor to the President for International Climate Policy, and other senior administration officials, promoted the dealer transferability option that enables consumers to claim the tax credit at the point of sale.
Over 13,000 dealerships have registered to offer the tax credit directly at the point of sale, with 90% of eligible EV buyers choosing immediate cash savings rather than waiting until tax season. This initiative has already saved buyers over $850 million in 2024. The IRS processes these advance payments quickly, typically within a week for dealers.
The 25E used clean vehicle tax credit provides up to $4,000 off qualified electric vehicles for individuals earning less than $75,000 annually, or $150,000 for married couples filing jointly. Given that most Americans purchase used cars, this tax credit enhances the affordability and accessibility of electric vehicles. Since January 1, 2024, consumers have been able to utilize both new and used clean vehicle tax credits when buying from participating dealers.
Major Commitments from Private Sector
During the convening, many attending companies, both large and small, announced substantial, voluntary commitments to promote the tax credit and facilitate its adoption, including:
- Carvana plans to integrate the used clean vehicle tax credit into its e-commerce platform by the end of summer 2024, allowing customers to see their savings at checkout instantly.
- CarMax will feature a badge on its website by January 1, 2025, identifying vehicles eligible for the federal Used Vehicle Tax Credit, enabling customers to search specifically for these options.
- Recharged commits to enhancing the EV buying experience by providing a comprehensive platform that includes buying, financing, and charging solutions for East Coast households by the end of 2025.
- Incentivize aims to form over 50 new partnerships by December 2025 to expand the availability of its EV Rebate Calculator, helping consumers access federal, state, and local EV tax credit and rebate information.
- Recurrent will publish vehicle eligibility for 25E rebates in its used EV history reports by July 2024, facilitating the adoption of used EVs by helping shoppers find eligible inventory.
- ZETA will develop consumer-oriented educational materials to promote awareness of the 25E credit and encourage EV adoption by January 2025.
- Maritz Automotive Solutions, as an automotive retail performance agency, will collaborate with original equipment manufacturers (OEMs) and dealers to support EV growth through training sessions on EV product knowledge, charging solutions, customer communications, and rebate management by December 2030.
- American Express Global Business Travel will launch its 2024-25 Ground Monitor publication in June 2024, advising corporates on integrating EVs into their travel programs and fleets.
- Sierra Club will create informational materials and host events throughout 2024 to raise awareness of the tax incentives to help consumers in reducing vehicle pollution and achieving climate goals.
- Plug In America will work with Google to develop a dealership identifier for Google business profiles, indicating IRS registration and participation in advance payments by September 2024.
- Environmental Defense Fund will train 50 companies on fleet electrification between June 2024 and December 2025, using its Net Zero Action Accelerator (NZAA) hub for training.
- Plug In America and Recurrent Auto will partner to maintain a comprehensive directory of retailers participating in the used EV rebate program and enhance PlugStar training content for at least 500 retailer and dealer sales staff starting in July 2024.
Challenges to EV Adoption: Infrastructure Barriers Persist
While the initiatives and commitments announced at the White House event highlight significant progress in making EVs more accessible through tax credits and incentives, a critical challenge remains: the infrastructure to support electric vehicles remains insufficient in many parts of the U.S.
In numerous regions, especially rural and underserved urban areas, reliable charging stations are scarce, hindering further adoption of EVs. The lack of a comprehensive charging network makes it difficult for many potential EV buyers to rationalize the transition from conventional vehicles, as concerns about finding accessible and convenient charging options persist.
As industry leaders and policymakers continue to work towards greater EV adoption, addressing these infrastructure barriers remains crucial. Ensuring that EVs are supported by a robust and widespread charging network is essential to achieving widespread adoption and realizing the environmental benefits of transitioning to clean transportation.
Simultaneous efforts are underway to tackle these challenges. The federal government, and many states, are investing in expanding charging networks, and private companies are developing innovative solutions, such as mobile charging units and ultra-fast chargers. Additionally, partnerships between utility companies and local governments aim to upgrade electrical grids to support EV infrastructure.
