Elon Musk says it’s time to move forward with this category of cars, here’s why:

The new proposals for tax relief for electric vehicles, which are part of the “Inflation Reduction Act of 2022”, while broadly supportive of the industry, left some Tesla, Inc. TSLA fans disappointed.

Tesla supporters cry foul: Tesla influencer and YouTuber Rob Maurer shared an open letter on Twitter on Friday to members of Congress to reconsider the stipulation that the production of plug-in hybrid EVs (PHEVs) is “overly rewarding.”

The proposal recommends that PHEVs, with a battery capacity of just 7 kilowatt hours, receive the maximum credit of $7,500, he noted. This compares to the $3,334 maximum credit allowed under current law for this category of vehicle, he added.

His contention was that field tests have shown that the role of PHEVs in emissions control has been “dramatically overstated” and that it is difficult to justify such a large credit for low-capacity PHEVs.

Related link: What does the new Senate agreement mean for Tesla, Toyota and other automakers?

Maurer cited Bloomberg New Energy Finance estimates that EV batteries cost $132 per kWh, and by extension, a 7-kWh battery would cost just $924. In contrast, a lower-emission all-electric vehicle battery requires 50 to more than 100 kWh of battery capacity, costing about $6,600 to $13,200, he added.

He recommended revising the proposal to either increase the 7 kWh requirement to match the proportional battery costs, or decrease the maximum credit allowed for vehicles with low battery capacity.

Musk responds: Quote tweet Maurer’s tweet with the text of the letter as an image, Tesla CEO Elon Musk said, it could be time to get rid of PHEVs. “Good point. Time to move from hybrid cars. That was a phase,” he says.

Tesla shares closed Friday’s session 5.78% higher at $891.45, according to data from Benzinga Pro.

Photo: Made with an image of Steve Jurvetson on Flickr

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