Is now the right time to buy?

The tricky part is they likely cannot guarantee delivery by year end. Not sure where you are (or if that matters), but in CA I've heard it's an 8 month wait. So glad I bought mine last year

 

Check with VW regarding a "written binding contract to purchase" per p.394 of the new IRA legislation.

The effective date is December 31, 2022.

If you can secure the contract *which must be binding*, the previous $7500 contract should apply.

 

Do folks think it will loose the tax credit January 1st, due to the battery pack not meeting the 40% requirement?

SKI makes the pack, and SKI is South Korea, which is a "free trade" country. But where SKI sources material, I cannot say.

For what its worth, I'm in CA and I was simply told "Q4" - no one told me 8 months.

 

I called VW Customer Care (800-822-8987) a couple of day ago and was told that if I make a reservation now, I could have it delivered around end of Oct - beginning of Nov. (model year 2023, assembled in TN). I had a previous reservation made in Feb but ended up canceling it for two reasons: a) it would be delivered around end of Nov and it will be a model year 2022, not 2023; b) since it is made in Germany, it does not qualify for any tax credit.
As Danrjones questioned, it is uncertain that the ID4 would qualify for the full tax credit come 1/1/23. VW customer care did not have any info regarding where SKI gets the materials from. They said they will internally escalate the question to get some info but haven't heard anything back yet.

 

Just came across with the following article published on 8/23/22:
https://www.reuters.com/business/autos-transportation/volkswagen-teams-up-with-canada-battery-materials-push-2022-08-23/#:~:text=Pablo%20Di%20Si%2C%20incoming%20president,the%20new%20Inflation%20Reduction%20Act.

"Pablo Di Si, incoming president and CEO of VW Group of America, said the automaker's U.S. plant in Chattanooga, Tennessee, aims to build 90,000 electric vehicles next year, adding that the new ID4 is expected to qualify this year for the full $7,500 U.S. tax credit under the new Inflation Reduction Act."

 

Interesting that people get different answers - was the a $100 reservation, or when you lock in at $400? I did my $100 beginning of Aug, but I sure hope it is Oct or early Nov. Even if the credit is still good Jan 1st, I'd still like it sooner. I sold my Leaf last weekend so now I'm between EVs. I would have waited longer, but the price caravana offered me was crazy good.

I haven't been contacted to lock in the $400, and others have said they have been waiting nearly a year.

 

I made my reservation over 3 weeks ago but the needle hasn't moved. I thought for sure I would have gotten some intro from the dealer? How was the experience / process w/ Caravan btw? I'm considering that.

 

Yes my reservation was about the same time.

Carvana was really easy. First I answered a few online questions on condition, and they gave me a quote. Then to continue, you give them photos / scans of your clean title, driver's license and one photo of the dash with ODO. I actually wasted tons of time taking photos of everything of the car, only to find out nobody cared. The most any of the online "Dealers" asked was for the photo of the dash and ODO. Once you send the paperwork copies, then you select an appointment - my closest was at our Walmart - then you drive over there on the appointment day and time, the guy took a few photos, had me sign a few papers, give them the title and keys, handed me a cashier's check, and I was done. Almost too easy. In CA, I then notify the DMV via a easy online form, call my insurance company, cash check. Done.

Though actually I cashed the check about ten minutes after he gave it to me. Cleaning out your car goes in that list somewhere too. He did mention he can adjust the offer down if needed on the spot; however, for me he said the car was fantastic, and did not even try. I have no idea how they would reprint the check if they had to adjust down the offer. Looking at sites like Vroom, Carvana, Carmax, KBB, Driveway, etc... Carvana seemed more interested in EVs. Vroom the least. Vroom's offer was lousy. Driveway was the second best.

 

Thanks for the info. that is too easy. I'd run to the bank too, just in case. I guess they run a title report so they know ahead of time the car is good. I bet they turn them over within days.

 

I keep looking to see when Carvana lists it, to see how much they add. Haven't seen it yet. Unless they sell it off wholesale or to another vendor, though it was in good shape, so I don't expect they would? I sold it Saturday, so actually its taking longer than I was expecting.

 

I'd say buy now as long as it's US built. I'm not convinced you or I will get one this year tho. Even next year with the battery rules phasing in I think there will still be a $3750 credit for the id4

 

my understanding was final assembly went into effect when it was signed into law in order to receive the credit you would’ve had to have a binding contract prior to the passing of the legislation. Since you did not have a signed/binding contract prior to the signing of the legislation I do not believe you can claim the tax credit here’s guidance from the treasury.

https://home.treasury.gov/news/press-releases/jy0923

I am absolutely not a tax professional and this is not tax advice you would need to contact a tax professional to get a more solid answer but I would hate for you to buy the car expecting the refund and then not be eligible or worse get the refund and then get audited and you owe the IRS money.

 

I’m no tax or legal expert but read a pretty comprehensive review of the new law (NYT?) and it seemed to suggest that the battery component requirement doesn’t kick in for about 2 years or so, so that the initial qualifying factor will just be if it’s built in the US. So I would do some more research to see for sure.

 

In the treasury guidance article above there is a link to a VIN Decoder on NHSTA Website that can be used to verify final assembly for the SPECIFIC vehicle I linked it below:
https://www.nhtsa.gov/vin-decoder

RANT
This was made needlessly messy; all of these provisions should have gone into affect January 1, 2023.
All this caused were vehicles that were eligible prior to signing to lose eligibility from what I can see, and not providing any manufactures time to shift final production m, to me it’s completely absurd. Just imagine having been in the process of buying a car on the week of 8/16 not having all the paperwork signed yet but aware of the tax credit and needing it to be able to afford the car (not the most wise choice but…) and as you’re purchasing the car already busy and distracted having this legislation slide across the presidents desk rendering your purchase ineligible for the tax credit.

 

just saw this article from consumer reports.: https://www.consumerreports.org/cars/hybrids-evs/electric-vehicles-that-qualify-for-new-ev-tax-credit-a9310530660/

 

I'm closely watching vehicles that don't (and won't) qualify for price reductions. Any vehicle that's built outside the US, enroute to general distribution without a binding contract will be at a competitive disadvantage - particularly with ADM.

Polestar 2, in particular should see price reductions.

 

I was thinking the same for Kia and Hyundai, but then, there are so few Ioniq 5's around, maybe it won't matter. But even if Ioniq 5 came down to its actual MSRP - that is still is 8 grand more than the ID4 with a tax credit. Or more maybe for 2023?

 

The Federal EV tax credit of $7500 was extended to 2032, and will be more restrictive to cars produced in the U.S. VW has begun to move ID4 production to the U.S.

"Currently, a few foreign nameplate automakers build EVs in North America. The Nissan Leaf is made in Symrna, Tennessee, and the Volvo S60 Recharge is produced in South Carolina. Production of the Volkswagen ID.4 was started outside of the U.S. but has recently moved to Chattanooga, Tennessee. The IRS will rely on a car's vehicle identification number, or VIN, to decide its country of origin."

 

This has been my assertion since I bought out 2019 Niro lease - prices for all vehicles (gas or electric) rose in the Covid years.

The 2023 Niro EV with the same features is at least $2500 more.