The electric vehicle market could be in for a jolt or atleast substantial decline in sales if tax incentives being offered at state and federal level are stopped says a new study.
Go green has been the motto of many governments since the last few years and one of the steps in this direction is offering generous tax incentives to all those who buy electric vehicles and plug-in hybrid vehicles.
More and more countries around the world are offering their citizens tax credits if they opt for an electric vehicle and U.S. and Canada are no different. A number of state and federal tax incentives have brought down the prices of electric vehicles substantially, but it turns out that these tax incentives might not last for long and a day will come when electric vehicles will have to stand on their own without the support of the government.
This could be a problem says Edmunds that has claimed that if the tax incentives are stopped, electric vehicle market could very well be towards a massive decline, so much so that it could even force some companies to stop selling electric vehicles in the US. Pointing to the case of Georgia, Edmunds notes that sales went from 17% of market share to just 2% when state incentives expired.
This is a far-fetched claim considering that electric vehicle market will mature in a few years thanks to the extensive research being carried out to develop cheaper and long-lasting batteries. With battery costs declining rapidly, some analysts believe that electric vehicles will dominate in a decade.
The electric vehicle market will reach a stage of maturity to the point that tax incentives will not be needed anymore and will offer substantial savings to consumers over gas powered vehicles.
Future of electric vehicles might not be clear if we take into consideration Edmunds’ claims as well as current limitations of electric vehicles, but with research will help us bring the costs down even further all the while ensuring that these vehicles start performing at par with gasoline vehicles.