Carnegie Mellon's Jeremy Michalek and Costa Samaras from the Center for Engineering and Resilience for Climate Adaptation discuss the electric vehicle tax credit.

As the reconciliation between the House and Senate tax plans approaches, the plug-in electric vehicle (EV) credit is on the line. The tax credit of $7,500 for the purchase of a new electric vehicle was excluded from the House plan, but it remains a part of the Senate plan. EV manufacturers worry that the loss of the tax credit would mean fewer sales at a time when more international auto companies are moving towards electric cars. Jeremy Michalek, director of the Design Decisions Laboratory at Carnegie Mellon University, and Costa Samaras, director of the Center for Engineering and Resilience for Climate Adaptation, recently joined the Knowledge at Wharton show on Wharton Business Radio on SiriusXM channel 111 to discuss the potential impact of doing away with the EV credit.

Introduced in 2012, the EV credit is widely viewed as one of the drivers for the growth of the electric vehicle market in the U.S.  “Losing that tax credit … will make a difference in people’s calculations of how attractive electric vehicles are,” Michalek predicted. The impact of doing away with the credit would be felt throughout the auto industry, the experts agreed. All the major automakers “have signaled that with or without this tax credit, their future is going to be more and more electrified,” Samaras noted. “Doing away with this credit is not just going to hurt Tesla; it’s going to hurt other manufacturers that have made big investments in this space.”

Additional coverage:

When Will Electric Cars Go Mainstream?

Tesla Speeds Ahead in the Electric Vehicle Market

The Road Ahead for Connected Vehicles

The Knowledge at Wharton SiriusXM show airs Monday through Friday, 10 a.m. – 12 p.m. EST, on Wharton Business Radio on SiriusXM channel 111.

Mastering Innovation: From Idea to Value Creation
Become the catalyst for company-wide change when you learn how to construct the architecture that drives innovation in an organization.
Learn more.