The electric vehicle industry has been a hotbed of innovation for many years, and the exciting technological advances continue, with companies around the globe contributing to the space. This news round-up brought to you by Ideal Power (IPWR) gathers some of the most important and critical events impacting EVs and the potential market opportunities the space presents for investors.
This month, we're looking at the steady increase in EV sales, a new all-electric pickup with a 500-mile range, and updates to the federal tax credits for EV purchases and EV charger installations.
EV sales maintain strong momentum
Electric vehicles made up 7% of the new vehicles registered in January in the U.S., marking a significant increase from the 4.1% recorded in January 2022. Data from S&P Global Mobility shows that EVs accounted for 5.6% of all new vehicle registrations in 2022, up from 3.1% the year before and 1.8% in 2020.
Overall, EV sales in the U.S. surged 48% for the first quarter to surpass 258,000 and account for 7.2% of new vehicle sales. Tesla remained the leader in U.S. EV sales, coming in far ahead of the rest of the pack with more than 161,000 deliveries during the first quarter.
General Motors sold 20,670 EVs during the first quarter, driven by robust sales of the Chevy Bolt. GM's EV sales were good enough to knock Ford out of the second-place position. Ford sold 10,866 electric vehicles during the first quarter.
However, that still marked an impressive 41% year-over-year increase despite hiccups that temporarily halted production of the best-selling Mustang Mach-E electric SUV and the F-150 Lightning electric pickup.
New all-electric Ram pickup truck to offer massive 500-mile range
Stellantis (STLA) is preparing to launch a new Ram electric pickup that will offer up to 500 miles of range on a full charge. The automaker officially unveiled the all-electric pickup on Wednesday at the New York International Auto Show.
According to Stellantis, the 500-mile range allows the new electric Ram to go further than the current gas-powered 1500 full-size Ram pickups on a full tank of gas. The new Ram's 500-mile range should put it on par with Tesla's Cybertruck, expected to launch later this year.
The electric Ram should be able to go further on a single charge than most of the other all-electric pickups already available, including Ford's F-150 Lightning, GMC's Hummer EV, and Rivian's R1T. That 500-mile range is the result of a massive 229-kilowatt-hour battery pack.
Stellantis said its standard 168-kilowatt-hour pack targets a range of up to 350 miles on a full charge. Ram added that both battery sizes will be capable of being charged up to 110 miles of range in only 10 minutes using 800-volt DC fast chargers.
The all-electric Ram 1500 REV will be able to tow up to 14,000 pounds and carry a payload of up to 2,700 pounds. The truck also features additional storage in its front trunk, or "frunk." The electric Ram 1500 REV also features 654 horsepower with 620 foot-pound of torque and 24 inches of water fording.
Importantly, it will also offer vehicle-to-vehicle, vehicle-to-home, and vehicle-to-grid bidirectional charging. The truck will also be available in five different trim levels. Ram did not release pricing for any of the new electric models.
Ideal Power collaborates with Tier 1 automotive supplier
In March, Ideal Power announced it had started collaborating with an unnamed global Tier 1 automotive supplier (disclaimer: the author is the President and CEO of Ideal Power). The supplier entered into an agreement to test and evaluate Ideal Power's B-TRAN™ bidirectional semiconductor power switch for its EV inverter, bidirectional charging, and circuit protection applications.
The Tier 1 supplier records multi-billion-dollar revenue every year and is a leader in vehicle electrification, EV systems, and clean mobility. The agreement builds on Ideal Power's custom module development with a Top 10 global automaker.
Under the terms of this latest agreement, the company plans to deliver B-TRAN™ samples to the Tier 1 supplier for evaluation in the second half of this year. Ideal Power plans to collaborate with the automotive supplier to gain an understanding of their EV applications and receive feedback on their product requirements — all with the potential goal of securing some kind of commercial agreement.
The remaining requirements for the EV tax credit go into effect
The rest of the requirements for an electric vehicle to be eligible for the $7,500 federal tax credit initiated in the Inflation Reduction Act go into effect on Apr. 18. The updated requirements significantly increase the amount of the battery and critical materials that must be sourced from North America. As a result, the number of vehicles eligible for the tax credit is likely to decline.
For an EV to be eligible for the full $7,500 tax credit, the Treasury Department requires half of the value of the battery components to be manufactured or assembled in North America. Additionally, 40% of the vehicle's critical materials must be sourced in the U.S. or one of its trade partners. Unfortunately, the Treasury won't release a list of the EVs that meet all those requirements until Apr. 17.
The share of the value of the battery component will continue to increase every year until it reaches 100% in 2029. The percentage of the critical minerals will continue to rise until it reaches 80% in 2027.
Even if an EV isn't eligible for the full $7,500 credit, it might still be eligible for part of the credit, depending on where it stands with those percentages. Additionally, drivers who aren't set on owning their EV might also be able take advantage of a potential loophole by leasing their vehicle. However, the Treasury Department is expected to provide clarification on that potential leasing loophole at some point, which might close it.
The IRS allows businesses to claim an unlimited number of commercial clean vehicle credits. As a result, some leasing companies that receive the tax credit might pass on the savings to their customers, possibly resulting in a reduced lease payment.
EV charger tax credit expanded to bidirectional chargers
The Inflation Reduction Act made the tax break for installing residential EV chargers retroactive to Jan. 1, 2022 and extended it through 2032. The tax break is the lesser of either $1,000 or 30% of the cost of buying or installing the charger.
The tax credit also now applies to bidirectional chargers, incentivizing EV owners who have a traditional charger to upgrade to a newer bidirectional model. Bidirectional chargers can enable EV owners to earn a little money by selling some of their vehicle's unused energy back to the grid. They can also use their EV's excess energy to power their home, like in the case of an outage.
Of course, bidirectional charging also requires an electric vehicle that supports it as well, so this upgrade will only help drivers who own one of the relatively few models that offer bidirectional charging.
To claim these EV-related tax credits, you'll have to file the appropriate forms with your tax return.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dan Brdar
Dan Brdar is the President, CEO and a Director of Ideal Power. He has over 30 years of experience in the power systems and energy industries and has held a variety of leadership positions during his career. In addition to his role at Ideal Power, Dan previously served as President and CEO of FuelCell Energy Inc., a Nasdaq-listed company with a market cap of over $250 million.
Read Dan's Bio