President Joe Biden’s administration is investing in American manufacturing and carving out new tax credits to make it more affordable for drivers to make the switch to an electric vehicle. Some Michiganders can save over $20,000.
MICHIGAN—A new analysis shows that Michiganders can save thousands of dollars by ditching their gasoline-powered vehicles for newer, electric models—namely by taking advantage of federal rebates that were made possible through President Joe Biden’s Inflation Reduction Act.
The new report—which was released last week by the Environmental Defense Fund and Climate Power—shows that many popular models of electric vehicles offer Michiganders thousands of dollars in lifetime cost savings when compared to similar, gas-powered models.
The key takeaway: Investments in electric vehicles are a “win-win” that will save Michiganders money and boost the state’s economy, said Saumya Narechania, a director at Climate Power.
“Electric vehicles are better for our environment and public health, and they’re becoming more affordable and accessible by the day,” Narechania said in a statement announcing the report.
The state-level analysis looked at the overall cost of purchasing and maintaining an electric vehicle when compared to similar, gas-powered models—including the average fuel, insurance, and maintenance costs over 10 years. Here’s a quick look at some of the key findings:
- Depending on the model and rebate eligibility, some drivers will be able to save more than $20,000 by making the switch from a gasoline- to an electric-powered vehicle.
- Drivers who switch from a gasoline-powered Ford F-150 to an electric F-150 Lightning are expected to see the most savings—an estimated $21,100 over a 10-year period.
- Switching from the Ford Edge to the sportier Mustang Mach-E still offers an estimated savings of $2,100.
- It’s not just Ford. The switch from a Chevy Trailblazer to a Chevy Bolt EUV is estimated to save drivers about $12,600 when factoring in federal rebates and overall fuel savings over a decade.
- Switching from a Toyota Camry XLE to a Tesla Model 3 offers the lowest savings—only about $500 over 10 years.
- Electric vehicles are becoming more affordable. There are at least 37 models of electric vehicles on the market for less than $48,000, which was the average purchase price of a new car last year. Ten electric vehicle models have a starting price of less than $35,000.
- Federal investments to support the transition to electric vehicles are expected to create about 20,000 new jobs and drive $21.9 billion in economic investment in Michigan.
Several new tax incentives enacted through the Inflation Reduction Act, the Infrastructure Investment and Jobs Act, and the CHIPS and Science Act have driven billions of dollars of investments in electric vehicle manufacturing, according to the Center for American Progress.
The Inflation Reduction Act also included tax credits for those who buy a new electric vehicle—with a base amount of $2,500 that can climb to $7,500 depending on the overall cost of the vehicle, when it was purchased, and whether it was assembled in North America.
Tax credits of up to $4,000 are also available on certain used models of electric vehicles. And beginning this year, customers can also choose to transfer those tax credits directly to a car dealer, which will effectively lower the purchase price of the electric vehicle at the point of sale.
The analysis released last week also highlighted how Biden’s plan to boost American manufacturing appears to be working—with 39% more electric vehicles manufacturing in North American factories in the first quarter of 2023 than the first quarter of 2022, Bloomberg reports.
More Savings Ahead
The new report did not factor in additional savings that Michigan drivers could realize through a new statewide tax rebate that was proposed late last year by Gov. Gretchen Whitmer’s office.
In December, Whitmer announced plans to create a new statewide tax rebate of at least $1,000 per vehicle—with an even bigger savings for drivers who decide to switch to an electric model.
Under the plan, all new gasoline-powered cars bought in Michigan would be eligible for a $1,000 rebate and electric vehicles would be eligible for a $2,000 rebate—with an extra $500 available for vehicles that were produced by workers represented by the United Auto Workers union.
That maximum $2,500 state rebate (paired with the existing $7,500 federal tax credit) could translate to a total savings of up to $10,000 off the cost of a new electric vehicle in Michigan.
“MI Vehicle Rebate will save you money on your new car as you walk out of the dealership with your keys,” Whitmer said in a statement. “Michigan’s auto industry is the backbone of our economy. Let’s keep making the world’s best cars and trucks while lowering costs for families.”
For the latest Michigan news, follow The ‘Gander on Twitter.
Follow Political Correspondent Kyle Kaminski here.
President Joe Biden on Friday issued a stark reminder about what’s at stake in the November election following a news report revealing that Donald...
BY ANNA LIZ NICHOLS, MICHIGAN ADVANCE MICHIGAN—Voters with disabilities can access new voter education videos featuring American Sign Language on...
A recent report from the state Office of Rural Prosperity identifies housing and workforce shortages as two of the biggest challenges facing rural...
We’re taking a tour to seven vibrant and stigma-shattering cannabis scenes in Michigan, curated by visionary Black entrepreneurs. MICHIGAN—When you...
FLINT—A Michigan man was charged Tuesday under the state's new law requiring safe storage of guns after his 2-year-old daughter shot herself in the...