Given that Tesla can supply those credits owing to its role as the first car producer to massively push EV over ICE technology and hence not produce common costs (CO2 emissions), this is a statement about Tesla and its position in the car industry in my book.

It's not a technological breakthrough, but in a world where common costs will be more factored into the balance sheets of those who create them, the fact that Tesla can be on the sell side of this and the trend to further quantify those costs might position them well.

It's not a technological achievement. It's a political one, as the middle class gets to subsidize the autopilot of the upper class, while the upper class gets to feel smug as though it's saving the world.

Tech always starts at the high end, then comes down to everyone. R&D has to be subsidized some how, this is the common cycle. With wars over oil, pollution, environmental destruction it seems like we've all been subsidizing our desire for cheap energy for sometime. Credits appear to be a lot more efficient to me.

Or you can look from the other side: people who buy cars that pollute air pay for the development of better cars.

If it _worked_ to reduce our overall carbon emissions, I wouldn't see this as a problem. As right now the pain of future generations is "subsidizing" our cheap energy and technology -- and as the shit hits the fan, I guarantee the rich will still be the most insulated from the pain by their wealth. We got to find some way to deal with climate change and our destruction of the environment, and any way is going to make energy and tech more expensive for everyone. Because it is cheaper to not worry about the devastation we are wreaking."externalized costs".

I just don't think it really works, it's just financial games in which the rich, as usual, profit the most. The owners of GM and Fiat Chrysler as much as the owners of Tesla.

If you can afford a brand new SUV, you can afford to pay the costs of your pollution.

It's an expedient choice. A more efficient mechanism would be to use a carbon tax to fully capture the externalities of energy use so that the market makes decisions with full information. But $10 or $20 per gallon gas would lead to riots in the streets.

I'd ride my bike everywhere at that price.

The whole point is it's not a subsidy, it's properly assigning costs.

Up until now ICE manufacturers and users havent being paying for the full costs of that technology, everyone has been subsidising them, this is designed to cancel that subsidy out.

It's better assigning costs, but still bad. A carbon tax is really the only way that works.

Society subsidized $10k on a Tesla purchase for someone to commute to work, but offered no incentive to take public transport, carpool or work remotely.

It's a shame that it's such a hard sell politically.

True, but don't let good be the enemy of perfect.

For a potential car buyer, this is a good incentive to steer them towards better choices.

Btw, it isn't society subsidising Tesla, its GM and Fiat Crysler customers. Or are you talking about tax credits? Perhaps? But on the other hand they were still paying more than what an equivalent ICE car would cost, so it isn't a free ride for them either. In the end society hopefully gets a sustainable EV industry, at a lower cost than if the government had done it themselves, isn't that what we should be comparing it against?

> For a potential car buyer, this is a good incentive to steer them towards better choices.

Talking about a "potential car buyer" is assuming your conclusion. If the outcome is going to be a car then you're steering them in the right direction. But you're also steering them away from non-car choices that would likely be better for society.

> Or are you talking about tax credits? Perhaps? But on the other hand they were still paying more than what an equivalent ICE car would cost, so it isn't a free ride for them either.

It is a free ride - taxpayers subsidize them buying a personal car, whatever their personal motivations for that choice were. And it's disproportionately the well-off who benefit.

> In the end society hopefully gets a sustainable EV industry, at a lower cost than if the government had done it themselves, isn't that what we should be comparing it against?

It is essentially the government doing it themselves - ultimately public money is being pumped into these EV companies in the same way as if they were a part-nationalised industry, with all the problems that that implies. The goal shouldn't be electric cars, the goal should be pollution reduction - imagine putting the same amount of subsidy towards e.g. bicycles for poorer inner-city residents.

"It is a free ride - taxpayers subsidize them buying a personal car"

But they're being subsidised to buy a more expensive car. The aim is to bring it in line with other more expensive cars.

It isn't $10000 off the default option, it's $10000 off the better for society option to bring it more in line with the default option. If it works as intended the buyer doesn't save money.

I suppose you could structure it to favour those with lower incomes, it would be more costly, more complicated, and I'm not sure how you could get to a sustainable model as quickly. Poorer people would presumably want cheaper cars, but currently EVs are expensive, so you would need to subsidise them that much longer, and potentially right about now you'd have cross subsidy anyway, with rich buyers buying expensive cars with R&D paid for with government subsidy money.

We can talk about alternatives to car, that isn't where politics is at, and I'm not sure tax credits would be a particularly good tool for encouraging alternatives. As I said don't let perfect be the enemy of good.

> It isn't $10000 off the default option, it's $10000 off the better for society option to bring it more in line with the default option.

Again you're assuming the default option is buying a car. Society shouldn't be paying people to buy cars, especially rich people: that's not a good thing to incentivise.

> We can talk about alternatives to car, that isn't where politics is at, and I'm not sure tax credits would be a particularly good tool for encouraging alternatives.

Surely if you believe tax credits work for electric cars then you should believe they would work for other things too.

> As I said don't let perfect be the enemy of good.

Is it even good though? It's hard to believe that paying rich people to buy cars (which still have negative externalities - land use, congestion, traffic deaths) is a better-than-replacement-level use of public funds.

How narrowly do you you want me to word it, for better or worse buying a car is the default. I'm not saying I like it.

Bicycles are relatively cheaper, I suspect the barrier to cycling isn't cost. Its infrastructure, culture, etc.

It is society subsidizing Tesla, because the negative externalities of GM and Fiat customers are both borne by everyone, but the transfer payments in compensation are paid to Tesla, not society as a whole.

I'm not saying it's a bad thing, and if we can't get a carbon tax I'll take what I can get. But let's call a spade a spade.

I do think we are missing out in a big way by not tipping the balance of hybrid TCO (eg a Camry) from slightly above to slightly below their equivalent models. Even a small tax could do that and it would make a much bigger difference than EVs have to date (but of course not in the long run).

> the negative externalities of GM and Fiat customers are both borne by everyone, but the transfer payments in compensation are paid to Tesla, not society as a whole

If the transfer payments mean Teslas become cheaper or more available, and therefore more people drive EVs, wouldn't that negate the negative externalities of using petrol vehicles?

It just reduces the negative externalities; the result of ZEV credits is a pool of cars, some ICE and some EV, that in total have reduced emissions compared to if all of the cars were ICE.

But they still have significant emissions, and society isn't being compensated for them.

It's better than doing nothing, but that's about all the praise I'll give it!

"It is society subsidizing Tesla, because the negative externalities of GM and Fiat customers are both borne by everyone"

Could you not then argue that Tesla owners are subsidising everyone else by bearing of lowering emissions which benefits everyone else?

> Btw, it isn't society subsidising Tesla

It isn't? Who paid for that $7500 tax credit?

"Btw, it isn't society subsidising Tesla, its GM and Fiat Crysler customers. Or are you talking about tax credits?"

You edited the comment, only the first sentence was there when I responded.

My comment hasn't been edited.

The middle class can buy Model 3s and get the tax credit as well. And the top 25% paid 85.97% of total income tax in 2016. So I think you have it backwards.

What you meant to say is that finally, politics has achieved something. The externalities of ICE are finally being paid for by the users of ICE.

The middle class enjoy the benefits of subsidies to the oil industry already. They are also getting cheaper prices due to the political resistance of including the costs of atmospheric carbon dioxide to the planet.

If the middle class would be willing to pay a carbon tax, then the current system would be needed.

I believe you meant to say "then the current system wouldn't be needed".

And possibly an illustration for the public of how the system was intended to work.

I'm not sure everyone quite understands that one big difference between a cap-and-trade type system and a simple excise tax is that an excise tax puts constant downward pressure on pollution, while the cap-and-trade type system only encourages the industry to reduce their externalities to whatever level the government picked as a target.

But if the government picked a tax rate, they'd likely do it with a forecast in mind of what externality would remain, so it only makes a difference in as far as there's uncertainty, and then only until the next round of permit quantities is picked.

There’s uncertainty at the Federal level, but at the State level, the CA ZEV credits program (which has also been adopted by 9 other states representing in total ~30% of new car sales) will be the tail that wags the dog;

”Manufacturers are required to produce a number of ZEVs and plug-in hybrids each year, based on the total number of cars sold in California by the manufacturer. Manufacturers with higher overall sales of all vehicles are required to make more ZEVs. Requirements are in terms of percent credits, ranging from 4.5% in 2018 to 22% by 2025”

https://www.arb.ca.gov/msprog/zevprog/factsheets/zev_regulat...

About 75% of GMs current credit balance comes from TZEV vehicles, but TZEVs are phased out and an increasingly large share of credits must be BEV going forward;

https://cdn.motor1.com/images/mgl/VZ44G/s1/carb-zev-percenta...

If Tesla were serious about advancing sustainable transport, they wouldn't sell credits to polluters. By enabling others to pollute that much more, it undoes much of the benefit from buying a Tesla.

This is true. It is a subtle problem with carbon offsets that is hard to understand intuitively even if it's logically straightforward. It makes being a truly "Green" consumer difficult when a "Green" producer can turn around and sell carbon offsets or the like based on the product you purchased.

"We can go bankrupt, or we can let our polluting competitors fund our R&D. Which should we choose?"

"Oh, definitely the bankruptcy."

It's amazing how many here are so disconnected from reality....

(ps. the id of the person you are replying to :D )

Thats under the assumption that without Tesla they'd make electric cars which is a bad assumption because they are building their biggest competitor which is their worse nightmare.

A more likely idea would be that without tesla they'd just pay the taxes or lobby for them to be lower citing the fact that they can't hit the goal like they have been in other places like the EU.