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Elon Musk says it’s time to move on from this category of cars, here’s why




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

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

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

His claim was that real-world tests have proven that PHEVs̵[ads1]7; role in emissions control has been “dramatically overestimated”, and it is difficult to justify such a large credit for low-capacity PHEVs.

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

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

He recommended revising the proposal to either increase the 7-kWh requirement to align with the corresponding battery costs or reduce the maximum credit allowed for vehicles with low battery capacity.

Musk replies: Quote-tweeting Maurer’s tweet that carried the text of the letter as an image, Tesla CEO Elon Musk said, it may be time to move away from PHEVs. “Good point. Time to move on from hybrid cars. It was a phase,” he said.

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

Photo: Created with a photo from Steve Jurvetson on Flickr





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