California to Reduce EV/Hybrid Incentives

California will drop or cut state incentives for electrified vehicles on Dec. 3 and shift the focus of remaining funds from luxury models to less expensive vehicles.

California Clean Vehicle Rebate

Under the program, hybrids and all-electrics that retail for $60,000 or more—such as the Audi e-tron, Jaguar I-Pace (pictured), Karma Revero and Tesla Model S and Model X—will no longer qualify for the state’s $2,500 clean-vehicle rebate. The change doesn’t apply to luxury fuel cell-powered EVs, which will continue to qualify for $4,500 reductions.

Incentives for less expensive EVs will be cut from $2,500 to $2,000, while the rebate for plug-in hybrids will be trimmed one-third to $1,000. Plug-in hybrids must have an all-electric driving range of at least 35 miles to be eligible.

Low- and moderate-income buyers can qualify for higher incentives depending on household size and income. The majority of the more than 350,000 rebates California has issued since 2011 have gone toward luxury electrics costing $60,000 or more.

Individual buyers and businesses will now be limited to one clean vehicle rebate per lifetime rather than the two that were previously allowed. California accounts for about half of all EV sales in the U.S.