General Motors has reported to have sold over 200,000 electric vehicle and now joins Tesla after hitting that key number which triggers federal electric vehicle tax credits to stop.
That threshold on cumulative sales of electric cars came in the fourth quarter of 2018, triggering a phaseout of the $7,500 federal tax credit over the next 15 months, sources told Reuters. Tesla hit the 200,000 mark in July.
GM will see the tax credit halve in April, and halve again to $1,875 in October, before ending in April next year.
The reduction comes as GM and other automakers massively boost investments in electric cars. GM plans to eventually go all-electric, ditching gas- and diesel-powered cars, as does Volkswagen.
GM stock rose 0.6% on the stock market today but remains stuck under the 10-week moving average. Tesla stock dived 6.8% Tuesday after the company announced a price cut for its electric cars and weaker-than-expected Q4 deliveries. Meanwhile Fiat Chrysler lost 0.9%, and Ford Motor rose 3.3%.
For Tesla, the federal EV tax credit was halved from $7,500 to $3,750 as of Jan. 1. The automaker said Tuesday it's taking steps to "partially absorb the reduction" by slashing Tesla Model S, Model X and Model 3 prices by $2,000 in the U.S.
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