US Invests $7.5 Billion by 2019 to Boost Electric Car Production image

The US government will spend $7.5 billion by 2019 on federal policies to promote EVs, a project which will have ‘little or no impact’ on the national gasoline consumption.

Almost 25% of the $7.5 billion cost will be covered by consumer tax credits for purchasing EVs, which can reach $7,500 per vehicle. The rest of the cost will comprise grants of $2.4 billion to promote EVs and $3.1 billion in loans for the automakers to boost production of electric vehicles. In 2007 the Bush administration authorized the loan program, and in 2009 President Barack Obama initiated many of these initiatives.

Plug-in hybrids and all-electric cars are the perfect solution to for the auto industry to deal with the stringent fuel economy aimed at cutting emissions and decrease the States’ dependence on oil. According to the US government standards by 2025 all automakers must reach an average fuel economy of 54.5 miles per gallon, which is 39 miles per gallon in real world driving.

“The more electric and other high-fuel-economy vehicles that are sold because of the tax credits, the more low-fuel-economy vehicles that automakers can sell and still meet the standards,” according to the report.