However, American automakers may suffer the consequences of tax cuts implemented by the next Republican administration. Specifically, the tax aid that has been applied for the purchase of electric vehicles.
During the management of Joe Biden A series of subsidies was implemented to encourage the consumption of this type of car and, to a large extent, helped the market recover. October closed with a 9.5% increase in new car sales compared to the same month of the previous year, reaching a total of 1,327,307 units.
If the accumulated of the year is taken, 0km sales totaled 13,095,740 units, which indicates an increase of 1.5% compared to the same period in 2023, according to preliminary data from private consulting firms. For some analysts, October’s growth could have been driven because last month had two more business days than the same month last year.
The incentives that have been granted by the automotive to encourage consumption, especially in the segment of electric vehicles of local automotive companies, one of the areas where Chinese brands are strongest.
What the automotive industry expects from the new Trump presidency
However, this policy could take an important turn in the coming years since different sources in the sector warn that the president-elect’s transition team Trump plans to eliminate the $7,500 consumer tax credit for electric vehicle purchases. This decision would be made within the framework of a broad tax reform that the Trump administration would introduce.
At this point, it must be taken into account that a measure of this type would have a direct impact on the business of one of the president-elect’s main supporters in the business world.
Elon Musk He is the owner of the automobile company teslaleader in this market segment and largest manufacturer of this type of vehicles in the United States. Despite all the speculation, journalistic reports indicate that Tesla representatives let it be known that they would support the end of these subsidies.
In that sense, Musk had commented, in the middle of the year, that Removing the subsidy could slightly hurt Tesla’s sales, but would be “devastating” for its electric vehicle competitors in the United States.which include traditional automakers such as General Motors. Also to other automotive companies such as Ford and the Stellantis Group, owner, among others, of the Chrysler brand.
Members of Trump’s team of advisors have been holding meetings to define the scope of this tax reform and one of the topics is the cut in aid for the purchase of electric vehicles.
On the other hand, The Automotive Innovation Alliance urged Congress in an Oct. 15 letter to preserve tax credits for electric vehicles, calling them “crucial to establishing the U.S. as a global leader” in auto manufacturing in the future.
His request does not appear to be heard as Trump campaigned to end Biden’s “electric vehicle mandate.”
Democratic transition team members warn it will be difficult to end some of Biden’s clean energy policies because they are popular and already funneling money to Republican-dominated states.
Source: Ambito
I’m a recent graduate of the University of Missouri with a degree in journalism. I started working as a news reporter for 24 Hours World about two years ago, and I’ve been writing articles ever since. My main focus is automotive news, but I’ve also written about politics, lifestyle, and entertainment.
