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The defeat of Prop 30 was a surprise to many EV enthusiasts.  This bill would have seen an extra 1.75% tax levied on the roughly 40,000 households in California whose annual income is above $2 million. All that extra revenue would have been channeled into EV charging infrastructure and EV subsidies.  California is the most EV-friendly state in the USA, and taxes on the richest members of society typically perform well in polling. Nonetheless, Prop 30 was defeated 59% to 41% during the recent midterm elections.  Does This Represent a Hurdle in California’s Goal to Be Fully Electric by 2030?  The loss of up to $5 billion in possible annual revenue will impact the state’s ability to rapidly expand charging infrastructure to make EVs more practical. California is, after all, a large state where many rely on cars for medium and long-distance travel.  That is likely the biggest impact of the defeat of Prop 30. The reduction of available subsidies will also slow the tide of electric vehicle converts. Although, in California, that’s less of a concern than the lack of charging infrastructure.  What Is the Possible Reasoning Behind So Many People Voting Against This Bill in America’s Most EV-Friendly State?  Early…

The Inflation Reduction Act is a landmark piece of legislation signed into law by the President in August 2022. Lawmakers focused a lot of their attention on emissions reduction and offered some incentives to help with the sales of electric vehicles. This involved a tax credit for those who want to purchase a used EV.  But what’s in the details, and how could you take advantage of this incentive? What Are the Rules? Consumers can now take a tax credit of up to $4000 (or 30% of the vehicle’s price) when they buy a used EV. The rules also place a price cap of $25,000 on eligible vehicles. Some rules are yet to be clarified, and it’s still unclear how many different models may qualify. Nevertheless, it’s a big leap forward from the status quo, where used EVs did not qualify for any kind of tax benefit before. However, one thing is clear: a used EV will only qualify for a tax credit if the manufacturing process includes final assembly in North America. The new tax credits become available on January 1, 2023. Starting in 2024, the credit will be applicable when you purchase a vehicle and will be an immediate…

Many industries face strong headwinds caused by macroeconomic forces, and the electric vehicle sector is no exception. Some believe demand may begin to fall away due to rising interest rates and a slowdown in general market performance. What does the picture look like at the moment? Interest Rate Challenges The continued rise in interest rates may impact electric vehicle stocks in the short term. Only recently, the Federal Reserve hiked base interest rates by three-quarters of a percentage point, which was the most significant increase for almost 30 years. This comes at a bad time for some EV manufacturers trying to expand production capacity to keep pace with a burgeoning market. However, these companies also need to keep a close rein on costs, and an uptick in the price of money may lead to a lower bottom line.  Of course, this is even more problematic for early-stage manufacturers who may be yet to turn a profit of any kind. They may need to attract further equity to fund any expansion, which could dilute individual stocks and cause additional problems. Supply Chain Disruptions and Commodity Issues Supply chain disruptions and rising commodity prices (linked to higher inflation) may also affect market…