Money, of course. And what drives money? Apparently, these days, it seems to be about tax policy. A catch 22?
Toyota seems to think so. This summer, Toyota hit their production limit of 60,000 for tax credits for buyers. And it hurt.
The $3600 tax credit is only guaranteed to a certain number of buyers for each manufacturer. Why each manufacturer? The logic seems flawed. My guess is that it was a nod to the big American car manufacturers like Ford and GM to give them a chance to compete with companies like Toyota. You know, that free market we’re so keen on…
At any rate, Toyota hit its limit before the credit was set to otherwise expire which means that the credit for buyers is now about half of the pre-limit level for Toyota purchases. Subsequently, taxpayers balked at buying a hybrid vehicle without the corresponding higher credit. Toyota officials claim that its hybrid sales in the US for the month of October (immediately after the limit was met) were the lowest since March.
Toyota’s North American President Jim Press urged Congress to extend the tax credits for hybrid vehicles, which Congress appeared to have little interest in doing before the elections. We’ll see what happens now.
