Elon Musk says Tesla to pay customers for missed tax credits

Tesla Inc. founder Elon Musk speaks at the unveiling event by “The Boring Company” for the test of the tunnel of a proposed underground transportation network in Los Angeles County, Hawthorne in the state of California, V. S., 18 December 2018. Robyn Beck/Pool via REUTERS

(Reuters) – the Tesla Inc (TSLA.O) chief executive Elon Musk said the electric car company will reimburse customers if delays of car deliveries lead to the missing of an important tax credit.

Under a major tax overhaul passed by the Republican-controlled US Congress late last year, incentives in the way of tax credits that lower the costs of electric vehicles are available for the first 200,000 vehicles sold by a car manufacturer. The tax credit is then reduced by 50 percent every six months until it gradually.

Earlier this year, Tesla said that the orders for cars placed by Jan. 15 to be eligible for the full tax credit of $7,500 and that the customers would receive their cars at the end of the year. From Jan. 1, 2019, the tax credit drops to $3,750.

With only a few days of 2018, some customers still waiting on their vehicles, have used social media to complain about the delay and what they call a lack of communication by the company.

Respond on Saturday to a Twitter user who asked what will happen if the car does not arrive on time, Musk replied: “If Tesla committed delivery & customer made good faith efforts to receive prior to the end of the year, Tesla will cover the r & d tax credit difference.”

Also on Saturday, Musk said on Twitter that the company must have all the orders for the mid-range Model 3 – a mass-market sedan that Tesla hopes is the key to success – delivered by the end of the year.

Reporting by Imani Moise; Editing by Daniel Wallis

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