SEOUL : Tesla CEO Elon Musk is ready to cut electric car prices again to drive sales if the economy swoons, and part of the reason is a bonanza from Biden administration tax credits.'It does make sense to sacrifice margins in favor of making more vehicles,' Musk said on Wednesday, noting that Tesla was fa
SEOUL : Tesla CEO Elon Musk is ready to cut electric car prices again to drive sales if the economy swoons, and part of the reason is a bonanza from Biden administration tax credits.
But whether Tesla offers additional discounts or not, the tax credits for battery manufacturing give it a competitive edge over rivals that make fewer batteries, Reuters' analysis of the company's second-quarter results shows. The battery tax credits in the Inflation Reduction Act, which kicked in this year, amounted to a subsidy of about $900 to $1,400 on every Tesla sold in the United States in the second quarter, according to the Reuters analysis based on Tesla's forecast and U.S. sales.
Consultancy Benchmark Mineral Intelligence estimates Tesla and Panasonic will collect about $1.8 billion in production credits this year, far more than the $480 million it expects for General Motors and its battery supplier, LG Energy Solution. "The value of credits this year will not be gigantic, but I think it could be gigantic. We think it probably will be very significant in the future," Musk said during Tesla's earnings conference call in January.
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