With the Federal EV tax credit dying at midnight on September 30, automakers are getting creative when it comes to giving their customers discounts on electric vehicles. Ford and General Motors are signing their respective dealers up for an ambitious plan that would — in effect — extend the $7,500 tax credit on leased EVs beyond the September 30 deadline, and the methodology is pretty wild.
Basically, each automaker's financial arm is going to initiate the purchase of a dealership's entire EV inventory by making the down payment on each car. That down payment qualifies the lending arm for the $7,500 federal tax credit since the deal would have gone through before the September 30 deadline, according to Reuters. From there, the dealerships will offer leases on those cars to retail customers — business as usual — for several months, and the $7,500 subsidy would be factored into the lease rate. This has got to be one of the more creative ways to give your customers a deal, as far as I've ever heard.
Here's more from Reuters:
"We worked with our GM dealers on an extended offer for customers to benefit from the tax credit for leases" of EVs, GM said in a statement to Reuters on Monday.
Ford said it was working to provide Ford EV customers with competitive lease payments on retail leases through Ford Credit until December 31.
Brandon Bell/Getty Images
GM gave its dealers until September 30 to participate, while Ford set a September 26 deadline, according to Automotive News. To sweeten the deal, Ford is offering its dealers a $1,000 incentive for each EV it leases through the program through the end of the year.
Both Ford and General Motors say they devised their programs in discussions with officials at the Internal Revenue Service, according to three people familiar with the discussions who spoke with Reuters. So, while it might sound a little screwy on its face, I suppose the program is completely kosher. It's not immediately clear if other automakers are following suit on this plan, but time is running out, and from the looks of it, they'd be fools not to.
Back in August, the IRS said vehicles must be purchased by September 30 to qualify for the $7,500 tax credit, so I guess that's what's happening here. It'll be interesting to see who is marked down as the first owner of these cars. Is it Ford and GM or is it the lessee? I suppose we shall see. In a lot of ways, it sounds like a less nefarious version of that scheme some Chinese automakers were pulling with their sales numbers.
