Economists predict that the number of electric vehicle registrations in the United States will decrease by 317000 per year, but Morgan Stanley analyst Adam Jonas pointed out in a research report released this week that the popularization process of electric vehicles in the United States will not stop as a result.
US auto stocks generally fell last week. According to media reports, President elect Donald Trump may plan to cancel the $7500 electric vehicle tax credit policy, which is an important part of the 2022 Inflation Reduction Act.
Joseph Shapiro from the University of California, Berkeley, stated that if the electric vehicle tax credit policy is cancelled, it will have a significant impact on future electric vehicle demand, potentially causing a 27% decrease in future electric vehicle demand. He conducted a joint study with Felix Tintelnot from Duke University and found that canceling the tax credit policy is expected to result in a reduction of 317000 electric vehicle registrations annually in the United States compared to maintaining it.
However, due to the low proportion of electric vehicles in new car sales, the impact of canceling tax credits on gasoline demand is relatively limited. Shapiro and Tinternot estimate that gasoline consumption will increase by 155 million gallons (approximately 600 million liters) in the first year; Within ten years, the total gasoline consumption in the United States will be about 7 billion gallons (approximately 26.5 billion liters) more than when tax credits were maintained. Shapiro pointed out in an email that although this number may sound significant, it only accounts for 5% of the average annual gasoline consumption in the United States, which is 136 billion gallons (approximately 514.8 billion liters).
Despite the risk of cancellation of tax credit policies, Morgan Stanley analyst Adam Jonas pointed out in a research report released this week that the popularization of electric vehicles in the United States will not stop as a result. Jonas said, "Although the popularity of electric vehicles may slow down, which has given some traditional car companies valuable catch-up time, in the long run, with the promotion of technological innovation and economies of scale, lower cost and higher performance products will continue to be launched, and the penetration rate of electric vehicles will continue to steadily increase