At midnight yesterday, two U.S. Federal incentives — designed to encourage the adoption of plug-in vehicles — ended. One gave plug-in owners up to 30 percent tax credit (worth up to $1,000) towards the cost of installing a domestic charging station. The other gave tax credits worth up to 10 percent of the sticker price of a new electric motorcycle, up to a total cost of $2,500. Thanks to the falling price of charging stations, the former shouldn’t have too much of an impact on electric car sales, but the latter is bad news for anyone wanting to buy a new electric motorcycle.
But Oregon-based Brammo Motorcycles has said it’s keen to keep the effective price of plug-in motorcycle ownership the same for its customers, so much so that it has introduced a ‘Retail Incentive’ which it says is the same value as the outgoing two-wheeled Federal tax credit.
“It is widely accepted that Federal Incentives will help kick start the EV industry,” said Brammo founder and CEO Craig Bramscher in an official Brammo statement earlier today. “Four wheel EVs, from the Tesla S to the Smart Car, receive a $7500 Federal Tax Credit. Our customers and dealers believe that a 10% incentive on two wheel EV’s will provide benefits ranging from decreased dependence on fossil fuels to a cleaner environment, and we agree.”
At the current time details of exactly how the incentives work aren’t clear, but Brammo says that customers buying the $10,995 2013 Bramo Enertia Plus will be eligible for a $1,000 ‘retail incentive,’ while those who chose to buy the far more expensive $16,995 Empulse sports bike will get a $2,000 effective discount from the ‘retail incentive.’
It’s worth noting too that while Brammo sells other electric motorcycle models, only these two models are mentioned in the press release, leaving it unclear as to if Brammo is offering incentives across its range or just on the two models listed. We’ve reached out to Brammo for clarification, so we’ll let you know more details as soon as we have them.
One thing we do agree with Brammo on however is the importance of incentives — or rather reduced pricing — on the EV market. As 2013 showed quite clearly, reduced prices of plug-in vehicles — caused more by market forces than incentives — helped bolster overall sales, but it also showed that a lack of incentives in the right place — namely two-wheeled electric vehicles in the UK — caused some manufacturers to bow out of the market altogether.
Bramscher says that he and Brammo will continue to lobby for the reintroduction of two-wheeled plug-in incentives at the Federal and state level, but for now, it appears the company is willing to take a cut in its profit margin in order to continue to support the market for plug-in bikes.
[Edit: We’ve just spoken with Brammo spokesperson Adrian Stewart, who has provided us with the following statement: “The incentives we announced today will run until all the 2103 model year bikes are sold.At some point in January we will announce the 2014 model year bikes and pricing. The incentives are reductions in MSRP at the dealership – not a mail in rebate.”]
The question is how long it will last — and how long other electric motorcycle manufactures follow suit.
Is this the start of a price war in the two-wheeled plug-in market? Or are the loss of official federal incentives the first of many cuts which will inevitably lead to the death of the Federal tax credit for plug in cars?
Leave your thoughts in the Comments below.
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