No carryover of CO2 2020 target

Wonky_Donkey

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Translation from French to English ....


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Despite the strong impact of Covid-19 on the automotive industry, the European Commission does not intend to postpone the CO2 targets imposed on manufacturers.

Claimed by some manufacturers, the postponement of CO2 targets for 2020 is not on the agenda. European Commissioner for the internal market, Thierry Breton could not have been more clear. " In no case will we delay the goals we have set for 2020"he said on Friday May 15 at a conference organized with representatives of the automotive industry and Frans Timmermans, executive vice-president of the Commission for the Green Deal.

CAFE regulations, which require manufacturers to drastically reduce their CO2 emissions this year, will therefore not be delayed despite the crisis.

On the other hand, the European Commissioner suggested that the recovery plans orchestrated by the member states should not only focus on support for green vehicles.

One way to adapt the response to the reality of an automotive market still dominated by sales of petrol and diesel vehicles. A choice that France may not make. Questioned by France Info, the Minister of Economy, Bruno Le Maire, spoke of "special support" for vehicles with the lowest CO2 emissions .
 

portlandg

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Depending on where Ford stand with their current emissions total this could mean that they might concentrate all of their early production of the MME to ship and supply us on this side of the pond. I wait with baited breath.
 

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Sounds like Ford is highly incentivized to sell every MME they can in Europe before the end of 2020 in order to meet emissions targets.
 

portlandg

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Sounds like Ford is highly incentivized to sell every MME they can in Europe before the end of 2020 in order to meet emissions targets.
That would good for us, not so good for you
 


KAustin

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I am surprised that the European Commission is taking that stance given the current crisis and economic turmoil. I guess they want their billions in penalties.
 

silverelan

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That would good for us, not so good for you
Yeah, there are some big financial implications for not getting the car in Fall 2020 in the USA.

For those of you not familiar with US taxes...
buyers in the US can potentially take advantage of the Federal EV tax incentive of $7500 during the calendar year they bought the car in. US Federal tax returns are filed typically between February and the April 15 deadline of the following year. So any MMEs bought in 2020 would be claimed on taxes between February and April 15, 2021 with the EV credit possibly being refunded in full a couple of weeks after filing.

If Ford delays US deliveries into early 2021, then that means anyone counting on that $7500 to use towards their down payment (like me) has to float the money for a year or more before getting it back on their taxes in 2022.

My personal preference from a tax perspective is to buy the car in December 2020 to minimize the window of time I'm floating that $7500.
 

portlandg

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I am surprised that the European Commission is taking that stance given the current crisis and economic turmoil. I guess they want their billions in penalties.
Absolutely correct. Why would they risk losing all that money at a time when they need to recoup as much as possible. Dont forget, it is probably not just Ford that this will potentially affect. All of the European auto makers will have the same issue.
 

eager2own

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If Ford delays US deliveries into early 2021, then that means anyone counting on that $7500 to use towards their down payment (like me) has to float the money for a year or more before getting it back on their taxes in 2022.

My personal preference from a tax perspective is to buy the car in December 2020 to minimize the window of time I'm floating that $7500.
Although you could adjust the withholding by your employer (if you are on W-2) based on your estimated taxes in 2021.
 

ChasingCoral

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Although you could adjust the withholding by your employer (if you are on W-2) based on your estimated taxes in 2021.
in my case I plan to retire at the end of 2020, so I expect my 2021 income to drop. That may hinder my ability to recoup the full $7500.
 

abr

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Yeah, there are some big financial implications for not getting the car in Fall 2020 in the USA.

For those of you not familiar with US taxes...
buyers in the US can potentially take advantage of the Federal EV tax incentive of $7500 during the calendar year they bought the car in. US Federal tax returns are filed typically between February and the April 15 deadline of the following year. So any MMEs bought in 2020 would be claimed on taxes between February and April 15, 2021 with the EV credit possibly being refunded in full a couple of weeks after filing.

If Ford delays US deliveries into early 2021, then that means anyone counting on that $7500 to use towards their down payment (like me) has to float the money for a year or more before getting it back on their taxes in 2022.

My personal preference from a tax perspective is to buy the car in December 2020 to minimize the window of time I'm floating that $7500.
For those in the US, even if you don't take delivery until 2021, you can recoup the $7500 tax credit almost immediately by changing your Federal Tax withholding. You don't have to wait until you file your 2021 taxes in early 2022 to get the cash back.
 

timbop

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in my case I plan to retire at the end of 2020, so I expect my 2021 income to drop. That may hinder my ability to recoup the full $7500.
I would say "Oh that's a shame", but since I am jealous because I have another decade of working I won't :)
 

dbsb3233

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Sounds like Ford is highly incentivized to sell every MME they can in Europe before the end of 2020 in order to meet emissions targets.
I'm dubious that it will change anything for Ford. Every time there's a recession, it dramatically impacts new vehicle sales, both in total, and in the types of vehicles people buy. On average, people look to spend less. That means cheaper models, which means smaller models (which are naturally more fuel efficient). That means the average fuel efficiency of ICE vehicles sold automatically improves.

I don't expect any shift from Ford. If anything, the COVID recession would make it easier for Ford to allocate fewer MMEs to Europe relative to what they planned pre-recession, not the need for more.
 

dbsb3233

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in my case I plan to retire at the end of 2020, so I expect my 2021 income to drop. That may hinder my ability to recoup the full $7500.
If you'll be over age 59 1/2 at the time, you can take a substantial withdrawal from a tax-deferred retirement account (IRA, 401(k), etc) in the same year as the MME purchase (assuming you have one). You'll have to estimate how much income you'll need to produce a $7500 federal income tax liability. If your normal income for that year is, say, $20,000 short, then take a $20k IRA withdrawal.

Not only will it enable you to take full advantage of the $7500 tax credit now, it avoids the tax liability that you would have incurred withdrawing it in future years.
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