Staff Reports
Gov. Newsom rolled out a new California EV rebate plan this week called MyFirstEV that promises $3,500 off a new zero-emission vehicle and $1,750 off a used one for first-time ZEV buyers. The state says it will put up $135.5 million and the automakers will match it, bringing the headline total to $271 million. It sounds generous—until you look at the fine print and the bigger picture.
What the MyFirstEV electric vehicle rebate actually does
The MyFirstEV program offers an instant $3,500 rebate on new electric vehicles under a $50,000 MSRP cap and $1,750 for used ZEVs under $25,000. California’s payment is matched dollar-for-dollar by participating automakers; Tesla, Hyundai, and Lucid are already on board. CARB’s chair praised the plan as expanding access to cleaner air and lower fuel costs. That all reads nicely on a press release, but the rules also exempt California-headquartered manufacturers that produce only ZEVs from the price caps—an exemption that smells a lot like insider favoritism.
Why this is government buying demand, not fixing the problem
Let’s be blunt: this is industrial policy with a polite name. Economists warn the state is taking money from taxpayers to pay buyers and automakers to move product people aren’t buying on their own. EV sales fell sharply after federal tax credits expired last year, and California’s own registration data shows a big dip in new ZEV registrations quarter over quarter. If customers wanted these cars at current prices, you wouldn’t need a rebate to make them show up. The policy treats demand like something you can manufacture by handing out cash, which sounds great—until the checks stop and the market hasn’t changed.
Who wins, who pays, and what gets hidden
Automakers get sales propped up; buyers get a small discount; taxpayers pick up half the tab. The program’s MSRP and used-vehicle caps look like they aim to help middle- and low-income families, but the exemption favors companies based in California that only build EVs. In plain English: if you’re a well-connected automaker in Palo Alto, you get a pass. Meanwhile, the program won’t fix the real hurdles that keep many Americans from choosing EVs—charging access in apartments, battery replacement costs, winter range loss, and higher sticker prices for many models. Turning subsidies into a permanent fixture isn’t smart policy; it’s political theater.
Better options than another rebate stunt
If Sacramento truly wanted to help families and build a durable EV market, it would focus on real infrastructure—fast chargers in urban apartments and rural areas, sensible grid upgrades, and targeted help for low-income households rather than blanket rebates that pad automaker sales. Let markets and competition lower costs over time instead of shoving demand around with taxpayer dollars. MyFirstEV will look good on a press release, but it’s mostly a short-term boost that buys a headline and protects an industry corner the way a velvet rope protects a nightclub VIP area.
