Analyst Expects Tesla, GM To See EV Tax Credits Restored With Biden Kicking Off US 'Green Tidal Wave'
President Joe Biden’s $2.3 trillion infrastructure plan — that aims to make a series of investments in bridges, roads, mass transit, and water infrastructure along with a hike in corporate tax — has set the stage for a "green tidal wave" in the United States, according to Wedbush analyst Daniel Ives.
What Happened: Ives sees the $174 billion electric vehicles push, which is part of the Biden administration’s infrastructure plan, to materialize in tax incentives to buy electric vehicles and new grants and incentives to build the 500,000 electrical-vehicle chargers by 2030.
The analyst expects the electric vehicle tax credits to expand to $10,000, currently valued at $7,500. Ives expects lifting of the 200,000-per manufacturer ceiling on the credits and restoring the EV tax credits for Tesla Inc (NASDAQ: TSLA) and General Motors Co (NYSE: GM).
Other point-of-sale rebates could also be included in the infrastructure bill to spur electric vehicle adoption faster, notes Ives.
Why It Matters: The U.S. lags the rest of the world in electric vehicle sales. The current EV contribution to the total auto sales in the U.S. stands at about 2%, compared to about 4.5% in China and 3% globally, according to Wedbush data.
Another key catalyst to the EV adoption would be the massive expansion of charging stations around the US over the next decade - from about 100,000 public charging ports now to 500,000 by 2030. Ives is bullish on ChargePoint Holdings Inc (NYSE: CHPT) among others.
See Also: 4 Infrastructure Stocks To Watch Ahead Of Biden's Trillion-Dollar Proposal
“Ford supports the administration’s efforts to advance a broad infrastructure plan that prioritizes a more sustainable, connected and autonomous future -- including an integrated charging network and supportive supply chain, built on a foundation of safe roads and bridges for our customers,” Ford Motor Co’s (NYSE: F) chief executive officer, Jim Farley wrote in a LinkedIn post.
Both GM and Ford, the top two U.S. automakers have lined up billions of dollars in investment to speed its electric vehicle strategy and roll out over two dozen electric vehicles in the pipeline.
Price Action: ChargePoint shares closed 19% higher at $26.70 on Wednesday and were up 1.12% in extended trading. Tesla shares closed 5% higher at $667.93, GM closed 1.79% lower at $57.46 and were up 0.23% after-market, and Ford shares closed 1.7% lower at $12.25, and were up 0.33% in extended trading hours.
See more from Benzinga
© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
