Every legislative decision around EV tax credits is like pulling teeth, from the battle to overhaul them to this new movement to repeal them. The House has already made its proposal, but that’s just one arm of the federal government. As it turns out, the Senate wants to end the current system even sooner — Like, possibly as soon as July 4 in certain cases. This means if you’re shopping for an EV, you might want to hurry up, as if the Senate gets its way, certain lease deals could be hit particularly hard.
We’re getting the most controversial news out of the way first, because everything else here is a bit less heavy. A new report suggests McKinsey put out the option of Stellantis selling Maserati, Ontario Premier Doug Ford recently had a close brush with alleged car thieves, and Jerry Bruckheimer and Tom Cruise want to get out there and hit the pace car again.
It’s a little grab bag of everything on today’s edition of The Morning Dump, proposed car laws and industry news and unusual car crime and film. I’ll be in the seat for the next few days taking over from Matt, so pull yourself a shot of espresso and get ready to read. Happy Friday, everyone.
The Senate Wants An Abrupt End To EV Tax Credits
We all kinda saw this coming, right? After making combustion engines a platform point, the current administration is working to roll back EV tax credits. After all, when you have a majority in the House and Senate aligned with the President, it’s easier to get stuff through before midterms have a chance of realigning the legislative branch. It’s not new information that EV tax credits are on the chopping block, but some of these credits could be axed sooner than expected. While the House proposes sunsetting credits for automakers who’ve built more than 200,000 EVs starting in 2026, the Senate is proposing a far more aggressive approach, as Automotive News reports.
The Senate version, released from the Finance Committee on June 16, treats all automakers the same by ending the EV tax credit within 180 days of the bill’s passage. That proposal would also cut the EV leasing credit immediately for vehicles that don’t meet local content rules and in 180 days for those that do.
“I think the Senate version is worse, totally cold turkey, and the lease thing is so important,” said Mike Murphy, a Republican political consultant and CEO of the American EV Jobs Alliance, a pro-EV lobbying group. “Bottom line is the Senate is really trying to put a stake in the heart of EV subsidies.”
The proposed immediate tax credit discontinuation for certain leases is especially important, because many cars that don’t quality for the full $7,500 tax credit if bought due to battery sourcing and/or place of assembly do qualify for the credit if they’re leased. Not only does this make driving a new EV more affordable, it also ensures a steady supply of gently used EVs once they come off lease in order to claw back some of the leasing super-cliff we’re now facing due to a downturn in new vehicle leasing starting in 2020.
While it’s true that EV tax credits for buyers probably can’t last forever, to me it seems soon to be phasing them out. We certainly haven’t reached natural price parity with combustion-powered equivalent models across the board, and many buyers are leaning on heavily discounted EV leases for reliable, reasonably inexpensive transportation now that the EPA’ footprint rule has basically killed subcompact cars. Going cold turkey on leasing credits for vehicles that don’t meet local content rules as soon as the bill passes would be a serious blow to consumers, not to mention the 180-day phase-out for qualifying vehicles. It’s no secret that credits play a huge role in consumer appeal and affordability, and J.D. Power has some surveys to back that up.
“For customers of Honda and Volkswagen, on average, the tax credit was the No. 1 purchase reason. For brands like Tesla, Cadillac and Chevrolet, among others, tax credits were amid the top three most influential purchase reasons,” [J.D. Power EV practice executive director Brent] Gruber said.
The self-imposed deadline for deciding when and how EV tax credits will be phased out is July 4, which means if you want to lock in a deal with absolute certainty regardless of whether the Senate’s proposal prevails, you have less than two weeks. Obviously, don’t go out and panic buy a car that you don’t need, but if you’re already shopping deals or have serious plans to lease an EV within the next three months, you might want to pick up the pace a touch.
The Trouble With Maserati
Oh, Maserati. What will we ever do with you? With total global sales more than halving last year to just 11,300 units, several canceled projects including the MC20 Folgore, and seemingly no easy way forward, it shouldn’t be surprising to hear Reuters report that Stellantis is mulling a sale of the Italian brand. This latest potential avenue seems to have started after the brand contracted McKinsey, a move that is rarely considered a good sign because no matter the industry, consulting is expensive and is generally an avenue to turn to when you’ve either exhausted all resources on hand or are trying something you’ve never done before. Considering Stellantis has extensive experience making cars and running car brands, seeking the help of big consultants for Maserati doesn’t paint a rosy picture of the present.
Stellantis hired consultant McKinsey early in April to advise it on the effects of the U.S. tariffs on Maserati and Alfa Romeo as the two brands prepare future plans. Stellantis affirmed then that it was fully committed to both brands.
However, a possible divestment of Maserati, its only luxury brand, is among the options McKinsey is exploring for Stellantis, the two sources told Reuters, adding the adviser’s assessment was still in the early stages. They spoke on condition of anonymity because they were not authorised to discuss the matter publicly.
Aside from the fact that DS is also a Stellantis-owned luxury brand, it’s not surprising to hear that selling Maserati has been suggested. Part of the dark side of consulting is having a scapegoat to blame if you already want to sell an entity or strip it of its assets, and while a decision hasn’t been made yet, it doesn’t sound like a sale is entirely off the table. It’s a divisive issue that reportedly comes with internal friction.
Some board members think Stellantis is not in a position to sustainably re-launch Maserati and suggest selling it is the best option. Others think Maserati still has value and that selling its only luxury brand would be a huge reputational setback for Stellantis.
The hard part here is that both sides have compelling arguments. On the one hand, it’s hard to justify several six-figure cars with reworked Alfa Romeo bones (looking at you, Grecale and GranTurismo), but Stellantis doesn’t have a whole lot of parts bin options. What’s it gonna do, use the STLA Large platform seen underneath the Dodge Charger Daytona, or launch a Hemi-powered Maserati just to have a V8? The former still seems to need some ironing out, while the latter just wouldn’t fly. On the other, if Stellantis were to reposition Maserati, the brand could be more successful.
Looking at actual market values of products, the GranTurismo needs at least a $20,000 haircut to move it in line with the Mercedes-AMG GT, and the Grecale probably needs a price point $8,000 to $10,000 lower than where it’s at right now so it can cosy up to combustion-loyal Porsche Macan owners who’ll soon be left without a really close replacement. Right now, Stellantis’ official statement to Reuters is “Respectfully, Maserati is not for sale,” but it’ll take some serious product and strategy to rebuild the storied marque. If Stellantis isn’t able to put in the work, maybe exploring a potential sale is the best option. Maserati was doing great when Ferrari owned it, maybe it’s time to see if Maranello wants it back.
Alleged Car Thieves Reportedly Tried To Steal A Car From A Sitting Politician’s House
If you’re American and watch cable news, you’re probably now aware of Ontario Premier Doug Ford, brother of the late Rob Ford. He’s been an unexpected voice in the tariff war, and while we aren’t going to get into Canadian politics here, one thing everyone can say is that he’s certainly a visible public figure in North America. It’s not surprising that the leader of a province would have a security detail in case anything happened, and while no threats to safety have been posed, something really dumb almost happened—Global News reports that four people have been arrested on charges of possessing an electronic device for motor vehicle theft after they were reportedly caught casing Ford’s residence on Tuesday.
Around 12:30 a.m., police said officers saw people in a vehicle wearing masks and slowing down as it approached a driveway in the area of Lawrence Avenue West and Royal York Road, the area where Ford lives.
A spokesperson for Toronto police confirmed that the incident was believed to be targeting Ford’s home address.
Police said they initiated a vehicle stop and one of the suspects got out of the car to run. Inside the car, they said they found a key reprogramming device and a programmable master key.
If I were to hazard a guess, the “master key” was probably just a blank fob, but with the right fob and programming device, that can be enough to steal whichever make of car is named on the fob. Still, this is what we call instant karma, but it also points to a problem that still needs tamping down. As we’ve previously detailed, organized car theft is a big problem in parts of Canada, with stolen vehicles exported to countries with relaxed rules on what vehicles make it in. There’s no easy solution here, so it’s understandable that more and more Canadian car owners are installing bollards on their driveways.
Hit The Pace Car Again
If we’re talking about the greatest car films of all time, “Days of Thunder” with Tom Cruise has to be up there on the list. From the rental car race to the cinematography of the cars on the ovals, it works well if you don’t take it too seriously, and despite basically being “Top Gun” with cars, it’s drawn admiration from some big names including Quentin Tarantino. If you still love it, you’re going to like this tidbit of news coming down the wire.
In an interview with ET from the red carpet of “F1: The Movie”, Jerry Bruckheimer has said that he and Tom Cruise are collaborating on a sequel to the iconic NASCAR film. We don’t know much right now, as it sounds like the project is in early development, but Bruckheimer said “We’ll have something really exciting for an audience once we pull it together.”
If this ends up happening, it’s going to rule. Has everything from the original “Days of Thunder” aged perfectly? No, but give it the leeway usually needed for a 35-year-old film and it still holds up pretty well if you take merely a semi-serious approach. Plus, if “Top Gun 2” was a smash hit, who says the “Days of Thunder” concept won’t be more successful when rebooted than it was at the original box office? It feels about time we had another NASCAR film, and I’m rooting for Bruckheimer and Cruise to pull this off.
What I’m Listening To While Writing TMD
Fair warning: The song I’m about to show you isn’t exactly outstanding or critically acclaimed, but it is interesting. There’s always something fascinating about insane collaborations between people you’d never think would be on the same track. In this case, it’s Ludacris, Zakk Wilde, Chad Kroeger from Nickelback, and the second singer of Three Days Grace, Matt Walst.
See, before Walst joined Three Days Grace, he had a band called My Darkest Days, and that effort managed to pull all these artist together for a debut single called, um, “Porn Star Dancing.” I mean, Chad Kroeger makes sense considering My Darkest Days was signed to 604 Records, but Zakk Wilde is a bit left-field for this flavor of music and Ludacris was only originally supposed to be on the Canadian version, but come on. Of course Luda rapping about strip clubs would have appeal everywhere, it was only a matter of time before his feature made it to the U.S. release.
I’m struggling to find an organic reason why “Porn Star Dancing” should’ve taken off, but it was big in Canada thanks to CanCon laws and the last dredges of post-grunge popularity, and it went to number one on the Billboard Modern Rock chart in America. The zeitgeist of 2010’s early stage of recession recovery probably helped because this is the sort of trashy, lecherous guilty pleasure that could get the people going in an era of trash TV and general leering. Truly one of the more bizarre modern rock tracks, but hey, if you haven’t heard of it before, now you have an unhinged musical fact to pull out at parties. Actually, given the subject matter, maybe “pull out” is the wrong way to phrase it.
The Big Question:
How long should the U.S. continue with EV tax credits?
Top graphic credit: Kia
I personally hate EVs but I think the tax credit should continue until the cost to build them becomes equal to the cost of building ICE vehicles.
Maserati has been an endless money pit for Fiat, Fiat Chrysler, and Stellantis the entire time they’ve owned it. I very much doubt it’s ever turned a profit or come anywhere close to covering its own R&D, and I really don’t think it’s intended market has ever thought of it as a viable option when cross shopping luxury cars, if they ever think of it at all. I think more people know the name “Maserati” than they do Maserati’s actual products
Really, going back, Fiat bought Maserati in the first place because De Tomaso was going under with them after trying to turn the brand into a higher volume automaker with the Biturbo, which failed, and De Tomaso had bought Maserati out of bankruptcy in partnership with the Italian government, after it crashed under Citroen ownership (Citroen had actually started the process of completely liquidating the company, before the last minute rescue deal came through.
At best, Maserati was maybe a viable company no more recently than 1972/1973, but it might actually have been longer than that
After essentially failing as a business over so many owners over more than half a century, Stellantis should just be realistic, if they knew how to turn Maserati around, they would have done it 10, 20, or 30 years ago. They can’t, they don’t have the resources, they don’t have the vision, but the brand does have value, so sell it to someone else who wants to take their own crack at it and move on
Frankly, Alfa Romeo should maybe be part of that conversation, too. Lancia is a different story, because their one model is actually weirdly, extremely successful in Italy and is a pretty low cost operation, it has to be making decent money right now. Maybe without the burden of supporting Maserati, they can double down on Lancia and strategically grow its range within Italy.
Here, here!
Maserati is to cars as MV Agusta is to motorcycle
EV tax credits should have gone away eons ago. Why should the vast majority of us subsidize the purchases a bunch of relatively wealthy new car buyers?
And the thought that EV credits are helping people would would otherwise buy the cheap hairshirt subcompacts that are a money-losing proposition for automakers is asinine. And most people in that end of the market don’t pay enough tax to take advantage of them other than by leasing anyway.
EV tax credits were designed to support a developing technology – not get poor people into EVs.
If US manufacturers are going to compete in the future they need to learn how to make good EVs and the USA needs to develop a domestic supply chain. That was the goal of the subsidies in the IRA.
As much as I like GT cars — Bentley, you didn’t build the EXP 10 Speed 6 Concept, and I’m still mad — Maserati is serving a market that doesn’t exist anymore.
I like 3-box sedans. I like GTs. I like how the MC20 looks, even though it’s really confused as to what mission it’s trying to fulfill (and doesn’t fill any of them right, aside from being the best looking car on sale).
Maserati has no clear mission, and is an amalgamation of half-baked ideas, in very pretty exterior styling with some good engines, that caters to a non-existent market.
That’s Maserati’s problem, and has been for most of 20 years. Maserati is something people like as an idea, but it doesn’t meet their actual needs, so no one buys them.