Updated

Updated · Car and Driver · Jul 13

California Signs $3,500 EV Discount Bill, Setting $270 Million Pool for First-Time Buyers

Updated

Updated · Car and Driver · Jul 13

California Signs $3,500 EV Discount Bill, Setting $270 Million Pool for First-Time Buyers

Q: Why does California's new EV rebate reward corporate HQs over local manufacturing jobs?

California’s new EV rebate favors corporate headquarters because SB 168 ties its main exception to where an EV-only company is based, not where it builds cars. Under MyFirstEV, most new EVs qualify only if they cost $50,000 or less. But the law waives that cap for EV-only automakers headquartered in California as of Jan. 1, 2026. That means higher-priced vehicles from Rivian and Lucid can still receive the full $3,500 rebate, even though Rivian assembles vehicles in Illinois and Lucid in Arizona. By contrast, Tesla still manufactures large volumes of vehicles in Fremont and supports thousands of California jobs, but it moved its headquarters to Texas in 2021. As a result, Tesla does not get the exemption; only its models priced under $50,000 qualify. The practical effect is that the policy rewards corporate domicile and executive presence rather than in-state assembly work. Critics say that is hard to justify if the goal is to support California manufacturing jobs, because the carve-out benefits companies with California offices but out-of-state factories while limiting a company with a major California plant. Supporters’ likely rationale is that the state wants to keep high-value corporate functions such as management, engineering, and product development in California, and to help homegrown EV brands during a sales slowdown after the federal tax credit ended. But as written, the law clearly prioritizes headquarters location over manufacturing footprint.

3 articles · Updated · Car and Driver · Jul 13

$3,500 off new EVs and $1,750 off used models are now locked into California law for first-time buyers, with point-of-sale discounts expected to begin later this summer.
The program caps most new vehicles at a $50,000 MSRP and used EVs at $25,000, while exempting California-based automakers from the new-car cap.
$135.5 million from the 2026-27 state budget will be matched by participating automakers, creating a $270 million incentive pool, though the automaker list is still pending and CARB expects to release it next month.
The measure follows the loss of the $7,500 federal EV tax credit and could expand sub-$35,000 EV options in California if brands such as GM, Nissan, Tesla, Ford, Subaru and Toyota join.

Sources

Left25%

Center75%

Car and Driver3d ago

California Governor Newsom Signs Bill for EV Discounts: $3500 Off New, $1750 Off Used

Office of Governor Gavin Newsom4d ago

As Trump cedes global clean car race to China, Governor Newsom fights back with instant ZEV rebates for first-time buyers | Governor of California

Ars Technica3d ago

California creates $3,500 rebate for new electric vehicle buyers - Ars Technica

12 Sources

As California offers EV rebates, will new federal fees stall the state's electric transition?

Why does California's new EV rebate reward corporate HQs over local manufacturing jobs?

California’s $600 Million MyFirstEV Program: New $3,500 Rebates Aim to Rescue EV Market After Federal Cuts

Overview

California has launched the MyFirstEV instant rebate program as part of a $600 million investment to make electric vehicles more affordable and support clean transportation. Funded by Cap-and-Invest revenue and smog-abatement fees, the program offers $3,500 off new EVs (up to $50,000 MSRP) and $1,750 off used EVs (up to $25,000), with the rebate applied instantly at purchase. Governor Newsom highlighted that MyFirstEV is designed to help families drive clean and save money, reinforcing California’s leadership in the clean energy transition and making EVs more accessible for residents.

...