Is now the right time to buy?

SKI (SK Innovation) has a battery manufacturing plant in Georgia that began producing batteries this year (9.8 GWh) and is building another one (11.7 GWh) which should begin production in 2023. SKI provides or will provide batteries to VW for the Chattanooga ID.4 and for Ford's Mach-e.

The Inflation Reduction Act has 3 criteria for the full $7,500 tax credit. 1. The EV must be manufactured in North America, otherwise no tax credit.

2. Critical Minerals ($3,750): Starting in 2023 (and after the Treasury issues guidance on
this requirement), to qualify for this portion of the credit, at least 40% of the value of the
battery’s applicable critical minerals must have been extracted or processed in the United
States or in a country with which the United States has a free trade agreement, or
recycled in North America. The 40% amount increases to 50% in 2024, 60% in 2025,
70% in 2026, and 80% in 2027 and thereafter.

3. Battery Components ($3,750): Starting in 2023 (and after the Treasury issues guidance
on this requirement), to qualify for this portion of the credit, at least 50% of the value of
the battery’s components must have been manufactured or assembled in North America.
The 50% amount increases to 60% in 2024 and 2025, 70% in 2026, 80% in 2027, 90% in
2028, and 100% in 2029 and thereafter.

The 2023 ID.4, for the USA market, will be manufactured in Chattanooga, TN. The battery is expected to come from the SKI plant(s) in Georgia. ($3,750 credit) Hopefully, at least 40% of the value of the critical minerals will come from a free trade country or the USA. ($3,750)

I reserved my ID.4 on 9/1/2022. I hope to get it in April or May, 2023.

 

Also did my reservation first week of August,

Also did my reservation first week of August, not getting any ETA from the dealer (they don't know) nor the VW call center. I'm hoping that i get the binding contract at least this year so I qualify for the credit but also hope to get the id.4 if not earlier..

Based on the IRS guidelines: https://www.irs.gov/businesses/plug-in-electric-vehicle-credit-irc-30-and-irc-30d:

Transition Rule for Vehicles Purchased before August 16, 2022
If you entered into a written binding contract to purchase a new qualifying electric vehicle before August 16, 2022, but do not take possession of the vehicle until on or after August 16, 2022 (for example, because the vehicle has not been delivered), you may claim the EV credit based on the rules that were in effect before August 16, 2022. The final assembly requirement does not apply before August 16, 2022.

Vehicles Purchased and Delivered between August 16, 2022 and December 31, 2022
If you purchase and take possession of a qualifying electric vehicle after August 16, 2022 and before January 1, 2023, aside from the final assembly requirement, the rules in effect before the enactment of the Inflation Reduction Act for the EV credit apply (including those involving the manufacturing caps on vehicles sold). If you entered into a written binding contract to purchase a new qualifying vehicle before August 16, 2022, see the rule above.

 

I don't see how a binding contract after Aug 16 does any good. We have to purchase and take possession before Jan1

 

I was invited to lock in Friday - and finally had time to sit down and locked in the $400 yesterday (Sunday). I stuck with a base Pro RWD model. I did add one option, the upgraded mirror with homelink - which I had been told by my local dealer wasn't available. But it let me add it anyway. The delivery timeline is estimated to be Dec to January. That isn't too far, but I would prefer sooner since none of us seem to know what will happen with the tax credit come Jan 2023.

So my pre order was Aug 10, and my invitation to finalize was Sep 16th.

December vs January could make a lot of difference here, as it sounds like a binding contract (now) doesn't lock in the $7500. Either the 2023 gets $7500 in Jan, or it gets $3750. Or zero if the pack was made in Korea for some reason, say the US SKI plant wasn't up to speed.

 

If you can get the 2023 vehicle, made in America by the end of the year, you are eligible for the $7,500 tax credit.

If the dealer can't give you a money back guarantee on a built in America, 2023 model by the end of the year, then walk away from it if you can wait it out.

 

Yes Dec to Jan (estimated delivery time) is right across the boundary. Though, I don't think we know "for sure" the 2023 won't qualify come Jan 1st. We just don't know. Uncertainty is a bad thing.