Tesla's Model 3 Long Range Scores Massive $7,500 Tax Credit – Here’s Why It’s a Game-Changer
June 19, 2024
Change is in the air for prospective electric vehicle (EV) buyers in the United States. The Tesla Model 3 Long Range has just become a whole lot more enticing. Effective immediately, this mid-range marvel is now eligible for the full $7,500 federal tax credit, making it a compelling option for anyone in the market for a new EV.
The Federal Tax Credit Maximized
The federal tax credit, a vital element in the promotion of EV adoption, currently offers up to $7,500 off the point of sale for vehicles with batteries sourced from the United States. This previously put the Tesla Model 3 Performance in the spotlight, offering it at a lower price than the Long Range variant. With this latest development, the scales have tipped favorably for the Model 3 Long Range.
Here's the juicy part: the Model 3 Long Range is now just $1,000 more costly than the rear-wheel-drive (RWD) Model 3. The kicker? The RWD variant doesn’t qualify for the tax credit because its lithium iron phosphate (LFP) batteries are produced by CATL in China. Thus, they don’t meet the federal requirements for the credit.
For a better perspective, at $40,000, the Model 3 Long Range tumbles significantly below the average new car price in the United States when the $7,500 credit is factored in. This makes it a formidable deal for a high-performance electric car.
Canadian EV Credit Shifts
Flash across the border to Canada, and EV incentives also register some changes. Tesla has responded to British Columbia's revised rebate rules, which lower the maximum MSRP range for eligible vehicles. The price of the Tesla Model 3 RWD has been slashed by $1,000 CAD, making it the lone Tesla that qualifies for this provincial rebate.
However, the climate isn’t as sunny for the Model Y in British Columbia, as it falls under the government's odd classification of sedans, rendering it ineligible for the provincial rebates. The federal rebate of $5,000 for EVs still applies, bringing some solace to disheartened Model Y enthusiasts.
Despite these hiccups, Tesla continues to dominate the Canadian EV market, accounting for 80% of the federal rebate applications in 2023. This marks an upward trajectory from 60% in the previous year.
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