UPDATE: U.S. Administration Outlines Rebates For Electric Cars
February 08 2011 - 6:49PM
Dow Jones News
The Obama administration outlined a rebate Tuesday that would be
available to buyers of electric cars at the point of sale, reducing
the sticker price by up to $7,500.
The U.S. Department of Energy said the proposal involves turning
an existing tax credit for electric vehicles into a rebate that
would be available to buyers immediately rather than making the
discount available only after filing a tax return.
Shares of Tesla Motors, Inc. (TSLA), the electric car maker
backed by Toyota Motor Corp. (TM, 7203.TO) jumped more than 6%
Tuesday, to $24.49. Battery maker A123 Systems, Inc. (AONE) also
saw shares jump more than 6%, to $9.92.
Some details of the proposal, including when rebates would be
available and whether the rebates would be capped, remained
unclear. David Sandalow, DOE's assistant secretary for policy and
international affairs, said details would have to be worked out in
Congress.
Companies like General Motors Inc. (GM) and Nissan Motor Co.
Ltd. (NSANY, 7201.TO) that already have electric cars on the market
are in good position to take advantage of the government incentive,
particularly if Congress places a cap on the rebates, said Jesse
Torpak, an auto analyst for TrueCar.com.
Torpak said the point-of-sale benefit made the cars more
attractive for lease as well as purchase by lowering monthly
payments.
"That's the kind of math you need to bring electric vehicles to
the masses," Torpak said.
In a little more than two years, Tesla Motors has sold about
1,600 cars worldwide.
In the U.S., the Nissan Leaf and GM's Chevrolet Volt, which just
went on sale in December, are only beginning to trickle into the
market. GM has sold 647 Volts over the past two months in the U.S.
Nissan has delivered 97 Leafs over that period.
Sandalow said the administration's proposal was part of a
strategy to support electric vehicle manufacturing. In a statement,
he said more electric vehicles on the road "represents a key
component of our strategy to reduce America's dependence on foreign
oil and ensure that the U.S. leads the world in the growing
electric vehicle manufacturing industry."
The administration announced the rebate initiative last
month.
President Barack Obama has set a goal of putting one million
electrical vehicles on the road by 2015. A DOE report released
Tuesday said that goal is ambitious, but achievable.
DOE also said the administration will propose giving grants to
30 communities to invest in infrastructure for electrical vehicles.
In addition, the agency said the president's upcoming budget
proposal will include further investments in research and
development for electric vehicle components, including
batteries.
-By Ryan Tracy, Dow Jones Newswires; 202-862-9245;
ryan.tracy@dowjones.com
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