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So, which product line in Indiana will Subaru replace with EVs? Impreza or Legacy? My bet is that Impreza will bite the dust: that would cut another hatchback from the American market.
While SIA production in Indiana is up slightly from last year it is still down 30% from 2019. SIA produced 368,519 for the 12 months of 2019, but only 275,150 vehicles for the last 12 months. For those same 12 months there were 31,952 Imprezas and 22,180 Legacy US sales.

That sounds like a lot of potential factory space to shift EV production to Indiana without initially affecting any existing production lines.

There is some reason to think that a third of the Legacy sales in the US have the 2.4L 260 hp engine, so the Legacy line may be a lot more profitable than the Impreza line even though the total units are less.

I like the Impreza very much, but unfortunately it represents Subaru's past and not its future. In any case the Impreza would not have to be retired immediately, but I have my doubts that it will ever see a 6th generation.
 

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An order sheet isn’t evidence that you purchased the vehicle. If you were audited by the IRS, that wouldn’t fly. Anyone can easily order and not purchase the vehicle, then try to claim the tax incentive. You need a purchase agreement that states payment etc.
Right, but obviously one wouldn't have the proof of sale until the car is delivered and paid for, which by definition could be after 12/31. I meant as proof that the car had been ordered before the cut off date.
 

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2019 Ascent Touring (me) 2020 Forester Limited (Spouse)
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So, which product line in Indiana will Subaru replace with EVs? Impreza or Legacy? My bet is that Impreza will bite the dust: that would cut another hatchback from the American market.
Not sure they would need to do that, honestly. The line at that plant is very versatile and they can run all the models made there down the same line intermixed. The only limitation is that two Ascents can't go through one after the other. There has to be another model between them due to physical size limitations. I could be wrong, but I don't believe they run the plant to full capacity, either, so adding another model probably wouldn't upset the production applecart, either. Now I'm speculating here, but...

I do believe that Subaru will be building PHEV and BEV vehicles here in North America as will Toyota/Lexus. My concern relative to BZ4x and Soltera (and the Lexus version) is more near term if they are not tax credit authorized because of a "domestic" production requirement. Toyota/Subaru likely made the decision to initially produce these first BEV vehicles in a single plant "close to the heart" of the respective companies for good reason. I sure would make the same decision. But the initial run could face an additional challenge getting off the starting line with consumers because of the purported language in the bill.
 

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While SIA production in Indiana is up slightly from last year it is still down 30% from 2019. SIA produced 368,519 for the 12 months of 2019, but only 275,150 vehicles for the last 12 months. For those same 12 months there were 31,952 Imprezas and 22,180 Legacy US sales.
I could be wrong, but I don't believe they run the plant to full capacity, either, so adding another model probably wouldn't upset the production applecart, either. Now I'm speculating here, but...
I did my best to answer this question earlier. If Subaru adds 50,000 Outbacks and Ascents when parts are more available, they could probably add 50,000 EVs before they have to discontinue Impreza and/or Legacy production. Normally a new generation of Imprezas would add to sales considerably, so I have my doubts if a 6th generation Impreza will ever exist.

The actual site may have room for more buildings as well.
  • Subaru of Indiana Automotive, Inc. (SIA)
  • Site Area: 820 acres ;
  • Improved Area: 690 acres ;
  • Building Area Footprint: 3,670,908 square feet ;
  • Floor Space with Mezzanine and Penthouse: 4,783,202 square feet.
 

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Right, but obviously one wouldn't have the proof of sale until the car is delivered and paid for, which by definition could be after 12/31. I meant as proof that the car had been ordered before the cut off date.
Not a lawyer but I believe the purchase agreement would be the binding contract. The delivery of the vehicle is a separate thing. Eg, purchase agreement signed on 12/31/22 but vehicle delivered on 1/31/22. I don’t believe the IRS would have an issue with that.
 

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Not a lawyer but I believe the purchase agreement would be the binding contract. The delivery of the vehicle is a separate thing. Eg, purchase agreement signed on 12/31/22 but vehicle delivered on 1/31/22. I don’t believe the IRS would have an issue with that.
But... the "before" event is, it seems, the date the law is signed, not its effective date (but I'm willing to be proven wrong).
 

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I really can’t believe the law would go into effect immediately upon signing. No law ever does that. Otherwise what is the point of the transition clause? Nobody would have anything signed before that.
And why would it be unrealistic for a dealer to make a purchase order and have the vehicle delivered at a later date? It’s not tax fraud. It’s written in the law that it could be delivered in 2023. The question is are they able to do it without a VIN. That I have no idea.
 

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Frankly, until it’s passed, which is still uncertain at this point, I’m not going to worry about what the specifics are or aren’t. There’s just too much uncertainty at this point, and even if it does pass, there could still be changes to the wording…so it’s anyones guess at the moment…
 

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I agree… maybe it would be different if there was a glut of EVs sitting around somewhere at a dealership that was itching to unload them, but the situation today is that “You don’t want it? OK…next in line, please”.

From what I can see, in the short term (next 2-3 years), the main effect the proposed legislation would have on EV sales is to drive up the domestic made EV prices even more. I don’t see a lot of pressure being applied to imported EVs in the short term.

Of course, from an individual standpoint, it may have an effect on which EV is purchased…
 

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I really can’t see the dealer going out of their way to write a purchase agreement without a VIN. Doesn’t benefit them to draft a contract that early.
There's a one-to-one relationship between the Order Number on the Order Sheet and the VIN on the car, each order with a unique Order Number will become a specific car with an actual VIN. It's just that the VIN isn't known as the time the order is placed, but at some point close to final assembly the Order Number and VIN will be irreversibly linked.
 

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There's a one-to-one relationship between the Order Number on the Order Sheet and the VIN on the car, each order with a unique Order Number will become a specific car with an actual VIN. It's just that the VIN isn't known as the time the order is placed, but at some point close to final assembly the Order Number and VIN will be irreversibly linked.
Sure but the person doing the auditing won’t really care about these nuances as there are 10 other manufacturers with their own unique ordering processes.

The gold standard is a purchase agreement and any other “contract” won’t really hold up.
 

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they are going to have to ditch CATL batteries though. Maybe Panasonic is building enough inventory with the shutdown to do just that.
In five years, those CATL Li-ion batteries could be quite valuable. With li-ion recycling in the US, those initially foreign manufactured EV batteries could be converted, by means of recycling, into American made Li-ion batteries.

I wonder how old a battery must be before it is rebadged, I mean recycled, into an American made battery.

In a normal economy (one not constrained by supply chain issues), I wonder what Subaru expects the residual value of their EVs to be. For their ICE Subaru cars, residual value is supposedly high. However, with tech advancement in EVs, surely that's going to change. Eg, if my solterra arrives with the expected CATL battery, in five years I expect the residual value will be whatever the battery is worth, and that's it.
 

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In five years, those CATL Li-ion batteries could be quite valuable. With li-ion recycling in the US, those initially foreign manufactured EV batteries could be converted, by means of recycling, into American made Li-ion batteries.

I wonder how old a battery must be before it is rebadged, I mean recycled, into an American made battery.

In a normal economy (one not constrained by supply chain issues), I wonder what Subaru expects the residual value of their EVs to be. For their ICE Subaru cars, residual value is supposedly high. However, with tech advancement in EVs, surely that's going to change. Eg, if my solterra arrives with the expected CATL battery, in five years I expect the residual value will be whatever the battery is worth, and that's it.
in 5 years, battery may be good only for lithium recycling. Solid state batteries are expected to finally come of age and other types of batteries, such as the accidental discovery by Drexel University using Lithium Sulfur. 3 times energy density, little to no hard to get elements and has tested charging 4,000 times with ZERO degradation. Also handles heat better for faster charging and little to no fire hazard. 1,000 mile batteries that can potentially last a million miles.
 

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in 5 years, battery may be good only for lithium recycling. Solid state batteries are expected to finally come of age and other types of batteries, such as the accidental discovery by Drexel University using Lithium Sulfur. 3 times energy density, little to no hard to get elements and has tested charging 4,000 times with ZERO degradation. Also handles heat better for faster charging and little to no fire hazard. 1,000 mile batteries that can potentially last a million miles.
But still no solution to thermal expansion of sulfur.
 

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But still no solution to thermal expansion of sulfur.
I didn’t see that in the article, unless I missed it. Testing for over a year seems to have given great results.

 

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In five years, those CATL Li-ion batteries could be quite valuable. With li-ion recycling in the US, those initially foreign manufactured EV batteries could be converted, by means of recycling, into American made Li-ion batteries.

I wonder how old a battery must be before it is rebadged, I mean recycled, into an American made battery.

In a normal economy (one not constrained by supply chain issues), I wonder what Subaru expects the residual value of their EVs to be. For their ICE Subaru cars, residual value is supposedly high. However, with tech advancement in EVs, surely that's going to change. Eg, if my solterra arrives with the expected CATL battery, in five years I expect the residual value will be whatever the battery is worth, and that's it.
Known. See ID.4 leases and Mach-E Options program. Residual is less than 50% so carmakers expect up to 60% depreciation in 3 years. This already happened with Leafs, Fiats, Bolts in the past. Part of the depreciation was caused by the tax credit pushing old car values down.

 

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Effects of the proposal to change EV tax credits are starting to meet resistance….


From the article…

”Auto dealers are worried they "will be left trying to explain to consumers why these incentives aren't available to them," Cody Lusk, president of the American International Automobile Dealers Association said Wednesday.”


“Democrats are divided over the proposals, even as Republican lawmakers are closing ranks in opposition.”

“Michigan Democratic Senator Debbie Stabenow said she is still pushing to change the proposals.”

"It's a very cumbersome, unworkable credit once the full restrictions set in," Stabenow told Reuters. "There's conversations going on."
 
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