Tesla Model Y gains full access to $7,500 EV tax credit with new $80,000 price limit
Tesla Model Y, which is undoubtedly the most important EV this year, has gained full access to the $7,500 federal tax credit with a new $80,000 price limit.
With the new year, the US Treasury released the full list of electric vehicles eligible for the new $7,500 tax credit.
At the time, we noted that there were some inconsistencies on the eligibility for the SUVs. The type of vehicle is significant, since it determines a price limit to be eligible for the tax credit.
SUVs and pickup trucks have a higher MSRP limit of $80,000 instead of $55,000 for all other vehicles.
We noted that the Tesla Model Y only qualified with a seven-seat configuration and other SUVs, like the Ford Mustang Mach-E, also weren’t considered SUVs, according to the IRS list.
That’s despite the VW ID.4, which has about the same size as the Model Y and Mach-E, being considered an SUV and getting access to the tax credit for a price of up to $80,000.
It appears that the IRS defines an SUV only by the vehicle’s GVWR or Gross Vehicle Weight Rating, which appears to need to be over 6,000 lbs to be considered an SUV. There might also be some other criteria that the IRS hasn’t shared because, again, there are some inconsistencies in the list if it’s just based on weight.
Many EV enthusiasts are seeing this as a major mistake since it goes against the purpose of the program, which is to encourage sales of more efficient vehicles. Vehicles with lighter weights are more efficient. There are several SUVs that have less cargo space than the Tesla Model Y and Ford Mustang Mach-E that are considered SUVs in the program, like the BMW X5 plug-in and Jeep Wrangler plug-in.
It seems to be a major faux pas by the IRS, especially when it comes to the Model Y, which is going to be the most crucial electric vehicle this year as it is expected to have a global production capacity of over 1 million units.
Today, the IRS updated its list of eligible EVs and fixed its mistake by making all versions of the Model Y eligible up to $80,000 MSRP:
| Model Year | Vehicle Description | Applicable MSRP Limit |
|---|---|---|
| 2022, 2023 | Tesla Model 3 Rear Wheel Drive | $55,000 |
| 2022, 2023 | Tesla Model 3 Long Range | $55,000 |
| 2022, 2023 | Tesla Model 3 Performance | $55,000 |
| 2022, 2023 | Tesla Model Y All-Wheel Drive | $80,000 |
| 2022, 2023 | Tesla Model Y Long Range | $80,000 |
| 2022, 2023 | Tesla Model Y Performance | $80,000 |
This should significantly increase access to the Model Y for people who are eligible to the tax credit in the US, meaning single fillers with an income of $150,000 or lower and dual fillers with an income of $300,000 or lower.
The Ford Mustang Mach-E has also gained full eligibility up to $80,000:
| Model Year | Vehicle Description | Applicable MSRP Limit |
|---|---|---|
| 2022, 2023 | Ford Escape Plug-In Hybrid | $80,000 |
| 2022, 2023 | Ford E-Transit | $80,000 |
| 2022, 2023 | Ford F-150 Lightning | $80,000 |
| 2022, 2023 | Ford Mustang Mach-E | $80,000 |
| 2022, 2023 | Lincoln Aviator Grand Touring | $80,000 |
| 2022, 2023 | Lincoln Corsair Grand Touring | $80,000 |
Again, these eligibilities for the full $7,500 credits are good until March when we are expecting new guidelines about the battery requirements, which should affect eligibility.
But for now, it’s good news all around. The IRS is clearly trying to do the right thing.
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Tesla has officially launched a new version of the Cybertruck RWD for $70,000 in the US and Mexico.
It’s more expensive than previously announced and loses a ton of features, but it has more range.
Earlier today, we reported on Tesla unveiling in the Middle East a new ‘Cybertruck Long Range’.
The automaker confirmed that it had a single rear-wheel-drive (RWD) motor, but unlike the previously announced Cybertruck RWD, Tesla said it had 350 rather than 250 miles of range.
This would point to having the same battery pack as the Dual Motor and Cyberbeast currently available.
At the time, it wasn’t clear if Tesla was launching this specific version for the Middle East or if it was the new Cybertruck RWD to replace the previously announced $62,000 version.
Now, Tesla has opened orders in the online configurator for the US and Mexico of the new Cybertruck Long Range RWD:
It starts at $70,000 before incentive – $9,000 more than the previously announced Cybertruck, but it has 100 more miles on a single charge at 350 miles.
It’s also $10,000 less expensive than the Cybertruck Dual Motor.
You not only lose a motor, but you also lose the powered tonneau. You can buy a “soft tonneau” for $750 and it increases the range to 362 miles:
The new cheaper version also loses the adaptive suspension, the lightbar at the back, the rear screen, and even the bed outlets, according to Tesla’s website.
Tesla says that deliveries are going to start in June.
Electrek’s Take
I might be wrong, but I would assume that the previously announced $61,000 Cybertruck is not going to happen. The Cybertruck is likely proving to be too low-volume to warrant producing different sizes of battery packs.
However, this version might be just to make the $80,000 Cybertruck look better.
It’s not to lose the AWD, the tonneau, the adaptive suspension, and even the bed outlets for $10,000.
These are all pretty essential features of the Cybertruck. I don’t think this version will sell much at $70,000. Maybe they get a few sales of people trying to take advantage of the $7,500 tax credit.
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![This electric excavator has battery swap tech that lets it recharge in minutes [update]](https://i0.wp.com/electrek.co/wp-content/uploads/sites/3/2025/04/electric-excavator.jpg?resize=1200,628&quality=82&strip=all&ssl=1)
The electric construction equipment experts at XCMG just released a new, 25 ton electric crawler excavator ahead of bauma 2025 – and they have their eye on the global urban construction, mine operations, and logistical material handling markets.
UPDATE: telematics announcement.
Powered by a high-capacity 400 kWh lithium iron phosphate battery capable of delivering up to 8 hours of continuous operation, the XE215EV electric excavator promises uninterrupted operation at a lower cost of ownership and with even less downtime than its diesel counterparts.
XCMG is delivering on part of that reduced downtime promise with the lower maintenance and easier repair needs of electric equipment, and delivering on the rest of it with lickety-quick DC fast charging that can recharge the machine’s massive battery in 1.5-2 hours … but that’s not the slick bit. The XCMG XE125EV can be powered up without leaving the job site thanks to its BYD battery swap technology.
We first covered XCMG and its battery swap technology back in January, and covered similar battery-swap tech being developed by MOOG Construction offshoot ZQUIP, as well – but while XCMG’s battery tech has been in production for several years, it’s still not widely known about in the West (even within the industry).
XCMG showed off its latest electric equipment at the December 2024 bauma China, including an updated version of its of its 85-ton autonomous electric mining truck that features a fully cab-less design – meaning there isn’t even a place for an operator to sit, let alone operate. And that’s too bad, because what operator wouldn’t want to experience an electric truck putting down 1070 hp more than 16,000 lb-ft of torque!?
Easy in, easy out
The best part? All of the company’s heavy equipment assets – from excavators to terminal tractors to dump trucks and wheel loaders – all use the same 400 kWh BYD battery packs, Milwaukee tool style. That means an equipment fleet can utilize x number of vehicles with a fraction of the total battery capacity and material needs of other asset brands. That’s not just a smart use of limited materials, it’s a smarter use of energy.
You can check out all the XE215EV’s specs at this tear sheet, and get an in-person look at the Chinese company’s latest electric excavator this week in Munich, Germany.
Telematics announcement at bauma
Earlier today, XCMG launched its next-generation Xrea Global Telematics Platform, integrating IoT, big data, cloud computing, and AI to enable what it’s caling, “seamless cross-border fleet management.”
The new telematics platform supports a dozen languages via PC and mobile interfaces, and offers real-time diagnostics, predictive maintenance, and data-driven optimization of both the vehicle and the vehicle’s batteries, empowering equipment managers and fleet operators to track fleets across town, or across time zones.
“XCMG remains committed to advancing engineering technology to empower a sustainable future. Our mission is to deliver efficient, intelligent, and eco-friendly lifecycle solutions for global clients,” said Mr. Yang Dongsheng, Chairman of XCMG Group and XCMG Machinery. “Today, 19% of our product portfolio comprises green innovations under our ‘Green Mountain’ new energy line, with full electrification across all series underway.”
SOURCE | IMAGES: XCMG; via PR Newswire.
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