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Tesla delivers its 200,000th car, triggering the EV tax credit phase-out period

Published

7 years ago

July 13, 2018

Simon Alvarez

Tesla has delivered its 200,000th vehicle this month, triggering the phase-out period of the $7,500 federal tax credit for electric vehicles offered in the United States.

As seen on Tesla’s official Electric Vehicle Incentives page, the phase-out period for the $7,500 federal tax credit is in effect for all Model S, Model X and Model 3 vehicles delivered on or before December 31, 2018, while buyers taking delivery in 2019 will only be eligible for a subset of that original $7,500 credit. Customers taking delivery between January 1 to June 30, 2019 will be eligible for a $3,750 federal tax credit, or half of the full amount before phase-out. Those taking delivery in the second half of 2019, between July 1 to December 31, 2019 will be eligible for a $1,875 federal tax credit.

The federal credit applied to new electric vehicles, dubbed by the IRS as the Plug-In Electric Drive Vehicle Credit (IRC 30D), affects all EVs that were acquired after December 31, 2009. The credit, which took effect during the previous administration as a means to encourage drivers to adopt zero-emissions vehicles, featured a tiered credit, starting at $2,500 and going all the way up to $7,500 depending on the battery capacity of an electric car. The IRS’ official website describes how the sale of a manufacturer’s 200,000th electric car triggers the tax credit phase-out period.

“The qualified plug-in electric drive motor vehicle credit phases out for a manufacturer’s vehicles over the one-year period beginning with the second calendar quarter after the calendar quarter in which at least 200,000 qualifying vehicles manufactured by that manufacturer have been sold for use in the United States (determined on a cumulative basis for sales after December 31, 2009) (‘phase-out period’).”

Tesla actually played its cards cleverly with regards to the $7,500 tax credit phase-out. Being a car company that exclusively manufactures electric cars, it was inevitable that the company would be the first automaker to hit the 200,000 mark. By reaching this milestone shortly after the second quarter, Tesla actually gave itself, as well as its customers, an additional 18 months to obtain any sort of credit. the $7,500 credit remains in effect for the whole quarter in which the 200,000th vehicle was delivered, as well as the quarter after.

After this point, the credit gets reduced by 50% to $3,750 for two quarters. In Tesla’s case, this corresponds to Q1 and Q2 2019. From Q3 and Q4 2019, Tesla’s vehicles will still be eligible for a tax credit, though it would be reduced to $1,875 by this time. Tesla’s electric cars produced from January 2020 moving forward will not be eligible for tax credits anymore.

In a way, Tesla’s timing for hitting the 200,000 mark appears to be strategic. The company, after all, just recently managed to attain its goal of producing 5,000 Model 3 per week by the end of Q2 2018. Signs from the company, such as test drives for the Model 3, massive batches of new VINs filed one after another, and a new 5-minute Sign & Drive delivery system, all seem designed to deliver as many of the electric cars to customers as fast as possible.

If there is a group of reservation holders that would feel the effect of the credit phase-out, however, it would be those holding out for the Standard Range RWD Model 3, which starts at $35,000. In a Twitter update, Elon Musk stated that Tesla would likely start the production of the base Model 3’s smaller battery pack by the end of 2018. From there, Musk noted that volume production for the vehicle would probably begin in Q1 2019.

In a meeting with investors and analysts this past Tuesday, Tesla’s Senior Director of Investor Relations Aaron Chew reportedly stated that the company is aiming to sustain its 5,000 per week pace for Q3 2018, increasing output to 7,000 cars per week for Q4 2018. By mid-2019, Tesla expects to produce 10,000 Model 3 per week, which corresponds to an output of 500,000 vehicles per year.

If Tesla manages to sustain its 5,000 Model 3 per week rate from August to September 2018, and achieve a steady rate of 7,000 vehicles per week from October 2018 to June 2019 (assuming no production ramps happen within these months), the company would be able to produce 292,000 Model 3. With a 10,000 per week rate from July to December 2019, Tesla would be able to deliver an additional 240,000 more. Thus, if Tesla plays its cards right and ramps the Model 3 in a manner that is careful and precise, it could deliver as many as 532,000 cars that are still eligible for federal credit (albeit the $3,750 and $1,875 credit). Considering that the backlog of 420,000 remaining Model 3 orders are from customers across the globe, there is a good chance that all present reservation holders in the United States would be able to get a credit for their vehicle.

Simon Alvarez

Simon is an experienced automotive reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday. For stories or tips--or even to just say a simple hello--send a message to his email, simon@teslarati.com or his handle on X, @ResidentSponge.

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Tesla receives its first robotaxi permit in California

Tesla’s robotaxi services are one step closer to making it to California.

Published

6 hours ago

March 18, 2025

Zachary Visconti

Credit: Tesla

Ahead of Tesla’s plans to roll out a fleet of commercial robotaxis, the company has gained its first permit in a series of those needed to begin operating driverless ride-hailing services in California.

On Monday, the California Public Utilities Commission (CPUC) announced the approval of Tesla’s application for a charter-party carrier permit, which licenses the company to run ride-hailing and chauffeur services in the state, according to a report from Reuters on Tuesday.

The permit allows Tesla to own and operate a chauffeur fleet for certain commercial purposes, including the ability to transport employees across pre-arranged navigation routes. However, this permit does not yet offer full approval for ride-hailing or autonomous vehicle use.

Still, the permit comes as the first in a series of those Tesla will need to launch a highly-anticipated autonomous robotaxi business, which is expected to begin rolling out in Texas and California this year. Tesla also released its two-seat, steering wheel-less Cybercab at an event in October, eventually expected to be the basic fleet vehicle for driverless ride-hailing purposes.

You can see Tesla’s render for a ride-hailing mobile app below, along with Teslarati’s coverage of the October 10 “We, Robot” unveiling event for the Cybercab.

Credit: Tesla

🎥: Our FULL first ride in the @Tesla Cybercab pic.twitter.com/6gR7OgKRCz
— TESLARATI (@Teslarati) October 11, 2024

READ MORE ON TESLA’S ROBOTAXI BUSINESS: Tesla flexes Robotaxi wireless charging — autonomy from top to bottom

In California, the CPUC will also co-manage regulatory needs for autonomy approval for Tesla, alongside the Department of Motor Vehicles (DMV).

During Tesla’s Q3 earnings call last November, Elon Musk said that Tesla employees in the Bay Area were already testing a ride-hailing service internally. Using an app, Musk said employees could already request rides and be taken to anywhere in the Bay.

Meanwhile, Tesla is aiming to roll out initial unsupervised rides as a service in the Austin, Texas area this summer, based on its Full Self-Driving (FSD) software. The system is first expected to be usable on individual owners’ vehicles, eventually using the recently unveiled Cybercab autonomous vehicle on a wider scale.

Tesla also hopes to expand the service to other states by the end of the year, though it’s not yet clear where.

Tesla mobile app tracker reports first lines referencing robotaxi service

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Tesla has joined the Australian Energy Council

Tesla Energy will join a top energy council in Australia, as it continues to deploy a wide range of battery projects in the country.

Published

8 hours ago

March 18, 2025

Zachary Visconti

Credit: Tesla Megapack | X

Tesla has been announced as the most recent member to join an industry group of electricity and energy businesses in Australia, coming amidst a wave of grid- and home-scale battery deployments in the country from the U.S. manufacturer.

Last week, Tesla Australia officially joined the Australian Energy Council (AEC) as the group’s newest member, contributing to a group of companies that administers gas and electricity to over 10 million homes. The news, announced in a post on LinkedIn, comes as Tesla continues to expand the presence of its grid-scale Megapacks and home-scale Powerwalls in Australia and elsewhere,

The council wrote the following announcement message in the post:

AEC membership provides an opportunity to collaborate to develop the solutions necessary to drive Australia’s energy transition. Together, we aim to create positive outcomes for consumers across the nation as the energy system decarbonises.

We look forward to working closely with Tesla Australia to help shape the future of Australia’s energy landscape.

The announcement also garnered a response from Tesla Energy’s Regional Director for the Asia-Pacific region Josef Tadich, who shared a few words about the news in another post:

A big thank you to Louisa Kinnear and the Australian Energy Council, Tesla are very much looking forward to working together in this space, in what is turning out to be an exciting 2025.

Wholesale and retail electricity markets are rapidly adapting and changing to new technologies, with more renewables and storage on the supply side, and more generation and flexible loads on the Customer demand side with VPPs, and controllable EV charging loads to name a few. Great time to be in this dynamic space!

READ MORE ON TESLA ENERGY IN AUSTRALIA: Tesla building battery repair facility near Collie Megapack project

The announcement comes as Tesla has shipped Megapacks to a handful of energy storage sites in Australia, including a 1,600MWh Tesla Megapack facility in Plumpton, Victoria that’s expected to turn on sometime this year. Tesla is also working on expanding the Western Australia “Collie” battery, which will feature 2,240 MWh of Megapack storage upon completion of phase two.

While the U.S. company currently builds its Megapacks at a so-called “Megafactory” in Lathrop, California, the company began production last month at a second Megafactory in Shanghai, China that’s expected to supply future energy projects in Australia. The company has also teased plans for a third Megafactory, though it isn’t yet clear where that could be built.

In addition to Tesla’s grid-scale Megapack batteries, the company also builds the Powerwall home-scale battery, which can be used for households or commercial buildings to store energy, along with being able to deploy energy back to the grid. Tesla also launched its next-generation Powerwall 3 in the Australian market last year.

The company utilizes its network of Powerwall owners to create giant, distributed batteries, called Virtual Power Plants (VPPs), effectively letting owners sell electricity back to the electrical grid during periods of peak demand. These programs are being utilized across much of Australia and several other markets throughout the world, and Tesla said in October that it had reached over 100,000 Powerwalls participating in VPPs worldwide.

Tesla Energy secures $375M Megapack contract

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Tesla arsonist set himself on fire after throwing Molotov cocktail: authorities

Witnesses reported that the suspect caught fire mid-act, with one device scorching his back as he fled.

Published

8 hours ago

March 18, 2025

Simon Alvarez

Credit: Tesla Asia/X

An arson attempt targeting a Tesla charging station in South Carolina left the suspect engulfed in flames and facing up to 20 years in prison, authorities have stated.

The suspect allegedly torched three chargers in a protest against President Trump and Tesla CEO Elon Musk, scrawling anti-Trump graffiti before accidentally setting himself ablaze with his own Molotov cocktails, as noted in a New York Post report.

Arsonist Burns Self in Tesla Protest

Federal prosecutors stated that 24-year-old Daniel Clarke-Pounder hurled five Molotov cocktails at a Tesla charging station in North Charleston, igniting three chargers while leaving messages like “f–k Trump” and “long live the Ukraine” in the area. Witnesses reported that Clarke-Pounder caught fire mid-act, with one device scorching his back as he fled, according to a police report cited by WCBD.

“The suspect had accidentally caught their own back on fire while throwing the devices,” an initial police report noted. Clarke-Pounder was arraigned in federal court, though his injuries remained undisclosed.

Backlash Targets Musk’s Tesla Empire

The fiery incident follows a wave of hostility toward Tesla, fueled by Musk’s leadership of the Department of Government Efficiency (DOGE) under U.S. President Donald Trump. Over the past months, Teslas have been subjected to vandalism incidents, and some locations have been shot up. In some cases, Tesla locations have been attacked with Molotov cocktails.

Officials such as President Donald Trump and Attorney General Pam Bondi have issued stern warnings against those who wish to attack Tesla and its customers. Trump, for one, pledged that anyone caught attacking American companies like Tesla will “go through hell.”

“No Place in Our Community”

Acting U.S. Attorney Brook B. Andrews condemned the attack, stating, “While we will defend the public’s right to peaceful protest, we will not hesitate to act when protest crosses the line into violence and mayhem.

“These kinds of attacks have no place in our community… We must remain united in our commitment to safety and respect for all, regardless of political differences.”