Electric Vehicle Incentives Make for a Sweet Deal

A change in the automotive industry is under way. The traditional gasoline engine that we have grown accustomed to over the last century is being challenged by a new competitor, a competitor that runs off batteries, emits no pollution and promises a greener tomorrow. This competitor, the electric vehicle, is slowly coming to fruition. Though it could be decade before the electric vehicle supplants the gasoline-powered car, it's something that is bound to happen at some point.

Right now, many electric vehicles are in the works. According to AutoblogGreen, models coming soon include the Nissan Leaf, Chevy Volt, BMW Megacity, VW Golf and several more. The drive to produce electric vehicles is on, though one thing still remains to be seen, how well will these vehicles actually sell?

Currently, AutoblogGreen states that huge incentives exist to encourage buyers to purchase electric vehicles. These incentives range from the $7,500 rebate from the federal government, to rebate of up to $5,000 more from the state of California, to discounts in Maryland. These rebates will effectively drive down the costs of electric vehicles substantially. Take the Nissan Leaf for example. AutoblogGreen lists the base price at just over $32,000, the Leaf may be no bargain, but when you factor in rebates, the new price of $25,280 or about $20,000 in California, begins to look very attractive.

There's no denying that an electric vehicle at a price of $20,000 is certainly a bargain, especially when you factor in the additional money saved on fuel, but what happens when all of the incentives vanish and prices start creeping back up? This has many automakers concerned. Questions such as; will buyers be interested in the Leaf at $32,000, or a Chevy Volt at $40,000-plus?

Eventually, as Automotive News points out, these questions will be answered as many of the incentive programs are due to be phased out starting three years from now, but automakers are already pushing to extend the incentives for much longer. Many automakers are suggesting that incentives should be extended to guarantee that electric vehicles make in-roads into the industry as it would be a significant benefit to the environment to guarantee the success of the electric vehicle. But it's still unclear if governments will extend incentives to please the automakers. At any rate, incentives will have to vanish some day and then electric vehicles will be on even ground with gasoline-powered cars, thus allowing us to see which technology is truly more desirable. Gas or electric? Which one will it be?

Source: Autoblog Green