[scottwsx96]

I came across this thread in r/Polestar where it appears analysis believes that, if the Build Back Better bill passes, the Polestar 2 will lose its eligibility for the $7,500.00 tax credit... retroactive to 12/31/2021. Bought a Polestar 2 in 2022 thinking it's essentially $7,500.00 cheaper than it is? Surprise! No soup for you!

It seems to be related to propping up American EV makers that have lost access to the credit due to volume, specifically Tesla and GM. It eliminates the 200,000 limit and requires the car to be primarily assembled in the U.S. and most battery components must come from the U.S. Here's an Electrek article about it.

As someone who bought this car partially counting on the large tax credit, this is disappointing news. I sure hope the "retroactive to 12/31/2021" part is misunderstood, wrong, or is changed and it's something that moves forward as of 1/1/2023 or later. Either way, this will put Polestar at a serious disadvantage in the U.S. going forward given that 1) Tesla will regain access to the $7500 credit, 2) Polestar will lose access to it, and 3) Polestar is affected by tarriffs due to assembly in China and Tesla is not.

 

[PolkNole]

That would never pass retroactively.

 

[P2TO]

I wonder if this explains the rumblings that Polestar have been prioritizing US orders in past 6 months and getting them to market faster. Would think their lobbyists must know that this was a possibility.

 

[ColoradoPStar]

I believe this is interpretation of the bill is incorrect (I have seen it floating around the internet - the retroactive part).

here is the bill with a hot link to the relevant text starting on page 366:

https://www.democrats.senate.gov/imo/media/doc/inflation_reduction_act_of_2022.pdf#page=366

On page 392:

1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by this section shall apply to vehicles acquired after December 31, 2022

This clause is repeated throughout for new evs, used evs, and PHEV

 

[Icesingh]

I believe this is interpretation of the bill is incorrect (I have seen it floating around the internet - the retroactive part).

here is the bill with a hot link to the relevant text starting on page 366:

https://www.democrats.senate.gov/imo/media/doc/inflation_reduction_act_of_2022.pdf#page=366

On page 392:

1) IN GENERAL.—Except as provided in paragraph (2), the amendments made by this section shall apply to vehicles acquired after December 31, 2022

This clause is repeated throughout for new evs, used evs, and PHEV

God save the trees that will be killed to print copies of that and any other bill…. 792 pages sheesh.

 

[julianm]

- remove -

 

[nbvolks]

Nope, that's not accurate:

But....the Polestar 2 won't be eligible after 2023 anyway, because it's not manufactured in the US. It also doesn't look like the Polestar 3 will be eligible, because while it will be built in the US, I'm not sure its battery will meet the requirements set forth in the bill.

 

[julianm]

It also doesn't look like the Polestar 3 will be eligible, because while it will be built in the US, I'm not sure its battery will meet the requirements set forth in the bill.

I know it’s possible, but I’m always curious about the folks who are happy to afford something like a Polestar 3 while not exceeding the new income cap.

I suspect they’re still the same people who don’t really need this EV credit. But I’m curious about where that suspicion is wrong.

 

[polerad]

Nope, that's not accurate:

View attachment 16128

But....the Polestar 2 won't be eligible after 2023 anyway, because it's not manufactured in the US. It also doesn't look like the Polestar 3 will be eligible, because while it will be built in the US, I'm not sure its battery will meet the requirements set forth in the bill.

and given the P*3 is meant to start at $75-80k, once you factor in destination and the options most would want in guessing MSRP will go above that cap

polestar will need to adjust its pricing, move P*2/4 build to N America, or give up on getting the credit

 

[nbvolks]

I know it’s possible, but I’m always curious about the folks who are happy to afford something like a Polestar 3 while not exceeding the new income cap.

I suspect they’re still the same people who don’t really need this EV credit. But I’m curious about where that suspicion is wrong.

300k joint income cap, isn't crazy for an $85k vehicle (after credits are applied).

 

[Aggie57]

Or Polestar could just do what GM did with the Bolt and reduce the price, assuming sales actually drop if they don't. Geely has made a huge investment in Polestar, it's a long game.

 

[ejinaz]

Nope, that's not accurate:

View attachment 16128

But....the Polestar 2 won't be eligible after 2023 anyway, because it's not manufactured in the US. It also doesn't look like the Polestar 3 will be eligible, because while it will be built in the US, I'm not sure its battery will meet the requirements set forth in the bill.

How would this affect Polestar purchases after 1/1/23? is the original 200,000 cap the same or does this replace those previous requirements? Below is a summary of the proposed plan....seems Polestar wouldn't Qualify as China doesn't have a free trade agreement and the batteries are assembled in China. Mine should be here in a matter of weeks so I should qualify for the $7500 regardless but am curious about the future of the tax credits.


The proposed legislation would allow carmakers to continue offering $7,500 in tax credits for the purchase of new “clean cars” with some conditions:

• Vehicles will need to be built with minerals that are extracted or processed in a country the U.S. has a free trade agreement with.
• Vehicles must have a battery that includes a large percentage of components that were manufactured or assembled in North America.
• For the first time, buyers can claim the credits as discounts at the point of purchase rather than waiting to claim them on their taxes.
• For the first time, used clean-energy vehicles will be eligible to receive $4,000.
• A prior requirement that qualified vehicles must have plug-in electric drive motors is dropped.
• The prior 200,000-vehicle per manufacturer cap would be dropped. Tesla, GM and Toyota have exceeded that threshold; Ford and Nissan are close behind.
• The deal caps the suggested retail price of eligible vehicles at $55,000 for new cars and $80,000 for pickups and SUVs.
• The maximum price for an eligible used vehicle would be capped at $25,000.
• Credits would be capped to an income level of $150,000 for a single filing taxpayer and $300,000 for joint filers for new vehicles.
• For used cars, the income levels would be capped at $75,000 and $150,000, respectively.

 

[polerad]

Unless something changes, except maybe for the completely base spec P*3, Polestar loses all credits going forward.

 

[ejinaz]

Unless something changes, except maybe for the completely base spec P*3, Polestar loses all credits going forward.

And should a single filer earning less than 150k really spend 75-80K on a car?

 

[salant76]

and given the P*3 is meant to start at $75-80k, once you factor in destination and the options most would want in guessing MSRP will go above that cap

polestar will need to adjust its pricing, move P*2/4 build to N America, or give up on getting the credit

I agree P*2/4 should be assembled in the Volvo SC plant. Consumers in the US would potential still get the $7500 tax credit and avoid the high tariffs (25%?). That would easily offset the other assembly and parts costs.

The issue is the plant isn’t set-up to build that platform. Which honestly seems silly. I personally see way more XC40s than S60s and XC90s. To make updates to the plant will take years to do.

With regards to leasing the P*2, I wonder if the lease terms for the 2023 (if leased in 2023) will change? Doesn’t Polestar not apply the $7500 to the lease?

 

[polerad]

With regards to leasing the P*2, I wonder if the lease terms for the 2023 (if leased in 2023) will change? Doesn’t Polestar not apply the $7500 to the lease?

They claim they use the $7500 to lower money factor and against the residual in some complex formula. But I’ve never gotten the math to work with their explanations

long story short though they’ll need to make the lease and MSRP rates competitive with the TM3 and i4 at each spec, and specifically noting that the TM3 SR+ gets the credit.

 

[Icegrill]

Find out why Polestars hate this one simple trick!

 

[PSinOR]

They claim they use the $7500 to lower money factor and against the residual in some complex formula. But I’ve never gotten the math to work with their explanations

long story short though they’ll need to make the lease and MSRP rates competitive with the TM3 and i4 at each spec, and specifically noting that the TM3 SR+ gets the credit.

Residual values on the Polestar 2 are inflated to 60+% of MSRP
As a couple of data point
EV6 residual is 46% of original MSRP.
The i4 is apparently 50%-55%
Tesla M# doesn't' have one - you can't buy it at the end of the lease.

The Polestar approach definitely reduces your lease payment, but sucks eggs if you want to purchase at the end of the lease. But using a lease to finance the purchase of a car is always going to be the most expensive way to go about it - by a very big margin. If you turn it in at the end of the lease you get the benefit of the Tax Credit. If you buy the car, you don't. If you even think you might want to buy the car, factor into the decision that leasing is an expensive path to do so.

 

[BayArea Polestar]

It’s Reddit for fucking sake. REDDIT. Please don’t believe everything you read - I come here for a break from the madness. 🤨🧐

 

[scottwsx96]

It’s Reddit for fucking sake. REDDIT. Please don’t believe everything you read - I come here for a break from the madness. 🤨🧐

Generally-speaking, I hear you, but r/Polestar is another community exactly like this one, except using a less feature-rich platform. In my opinion, there is no difference between a discussion here or there.