I get nervous when governments try to pick winners and losers because they always seem to get it wrong.
The U.S. government has handed out huge subsidies on electric vehicles for quite a while — and would appear to have kept Tesla afloat in the process. But it is time to cut EVs free and see if anyone really wants to buy them. Considering all the companies that are pouring billions of dollars into battery-powered electrics, we need to find out if they can survive without government support.
Tesla has reached the 200,000-sale threshold where federal EV credits start to phase out, and General Motors is about to hit that level. No other automaker is close to reaching that mark in the U.S.
Car companies are investing billions of dollars in EVs and autonomous vehicles without any hue and cry from consumers suggesting they are willing to pay for this new technology.
Meanwhile, several folks out there are lobbying for liquid gas subsidies, and I am sure that all the diesel producers in the world would appreciate it if the government would throw a few thousand dollars in subsidies on diesel engines. No doubt the manufacturers of autonomous vehicles will start crying for some sort of incentives as well. The debate about who should get help and how much will go on and on.
The car business is very competitive and there is always some technology looming that promises to revolutionize the business. But why don't we simply let the marketplace decide?
President Donald Trump has threatened to eliminate GM's EV subsidies because of the company's decision to close plants in the U.S. But eliminating EV subsidies should not be a penalty for GM.
It is simply time to eliminate all electric vehicle subsidies.
It is time to let these companies and these EVs survive on their own.