New links to IRS information on the Inflation Reduction Act’s clean vehicle and refueling infrastructure tax credits, together with updated sample federal EV credit seller report forms (in both PDF and Word versions), have been posted to the NADA Regulatory Affairs Alternative Fuel Vehicle and Refueling Incentive webpage (NADA login required).
NADA has created the 2023 IRC Section 30D Clean Vehicle (NADA login required) form for qualifying new vehicles and the 2023 IRC Section 25E Previously Owned Clean Vehicle Tax Credit Report for used vehicles as templates for dealers to provide to their customers and file with the IRS.
In addition to becoming familiar with this information, dealers should pay close attention to any EV tax credit communications they receive from their OEMs and the finance sources with whom they work.
Finally, consumer leases may also qualify for tax credits. More information can be found here. The IRS released a list of eligible OEMs here.
The National Automobile Dealers Association (NADA) issued its analysis of 2022 U.S. auto sales and the economy.
2022 ended with new light-vehicle sales reaching 13.7 million units, the lowest full year sales total since 2011. Year-over-year 2022 sales decreased 8.2% compared to 2021 with the decrease primarily attributed to the ongoing semiconductor microchip shortage and additional supply chain disruptions.
In 2022, light-trucks accounted for nearly 80%, 79.4%, of all new vehicles sold, up 1.6% from 2021. Crossovers remained the most popular segment representing 45.2% of all new light-vehicles sold. Alternative fuel vehicles also gained market share with sales of hybrids, plug-in hybrids (PHEVs) and battery electric vehicles (BEVs) accounting for 12.3% of all new vehicles sold, an increase of 2.7% compared to 2021.
Franchised dealerships nearly doubled the number of BEVs they sold in 2022, reaching 259,728 in 2022, an increase of 92.1% compared to 2021. Franchised new-car dealerships captured 35.2% of the total new vehicle BEV market with continued BEV sales growth in 2023 as new models from legacy automakers hit showrooms and more BEV inventory is available.
When contrasting vehicle sales to inventory, inventory levels at the end of December 2022 totaled 1.67 million units, a 49% increase compared to the total 1.12-million-unit inventory at the end of 2021.According to Wards Intelligence, North American light-vehicle production is expected to total 14.2 million units in 2022 with production forecasted to rise to 15.4 million units in 2023 as supply chain issues improve gradually.
Read the full article here: NADA Issues Analysis of 2022 Auto Sales and 2023 Sales Forecast | NADA
The Chicago Automobile Trade Association, producer of the Chicago Auto Show, exclusively invites you to attend the show’s Social Media Preview on Friday, Feb. 10 (8 a.m. – 2 p.m.). Many automakers are planning special events to showcase their latest vehicles, innovative technology, new safety features and industry trends. Click here to register.
This is a great opportunity to gather content for your brand(s) – especially geared towards a social media audience – while seeing the latest from the auto industry before the public show opens the following day.
Secondly, please consider adding the 2023 Chicago Auto Show and First Look for Charity website graphics and social media assets to your dealership’s website and social media pages. We’ve uploaded all assets here including graphics, photos and videos.
Please reach out to Hayley Feichter with any questions.
Tickets and coupons that admit the holder to the 2023 Chicago Auto Show free or at a reduced price can be ordered by CATA members using the order form posted at www.CATA.info.
The passes promote goodwill with customers and even can help persuade a prospect to close a deal. Two kinds of passes are available, General Admission tickets and Weekday Discount coupons. The former, which costs CATA members $7 each for a minimum 100 tickets, admits the holder to the auto show free, without a box-office wait. The coupon costs members $100 for 100 and admits the holder for $10 during the week. Regular adult admission is $15.
Click here to download the order form.
The IRS has released the following information and guidance on Clean Vehicle Credits:
IR-2022-231: IRS releases frequently asked questions about clean vehicles credits for new, previously owned and commercial clean vehicles
FS-2022-42: Frequently asked questions related to new, previously-owned and qualified commercial clean vehicle credits
IR-2022-232: Treasury, IRS issue guidance on their intent to publish regulations regarding clean vehicles
Notice 2023-1: informs taxpayers that the Department of the Treasury and the Internal Revenue Service (IRS) intend to propose regulations addressing the definitions of certain terms in respect of the credit available under section 30D of the Code, and lays out the expected content of those regulations. The proposed regulations will include definitions of the following terms, which are relevant for new clean vehicles placed in service after December 31, 2022:
Notice 2023-9 will be in IRB: 2023-3, dated January 17, 2023.
IR-2022-233: Treasury, IRS issue guidance on the incremental cost for the Commercial Clean Vehicle Credit
Notice 2023-9: informs taxpayers that based on analysis by the Department of Energy of representative qualified commercial clean vehicles and comparable internal combustion engine vehicles, the Department of the Treasury and the Internal Revenue Service (IRS) have reviewed the incremental cost for all street vehicles in calendar year 2023. This analysis shows that the incremental cost of all street vehicles (other than in the case of compact car PHEVs) that have a gross vehicle weight rating of less than 14,000 pounds will be greater than $7,500 in calendar year 2023. Accordingly, the incremental cost will not limit the available credit amount under § 45W for street vehicles (other than compact car PHEVs) that have a gross vehicle weight rating of less than 14,000 pounds and are placed in service in calendar year 2023.
For compact car PHEVs for which the incremental cost was calculated to be less than $7,500, the Treasury Department and the IRS will accept for vehicles placed in service during calendar year 2023 a taxpayer’s use of the incremental cost published by the DOE in calculating the § 45W credit amount. In addition, this analysis provides an incremental cost for several different classes of street vehicles with a gross vehicle weight rating of 14,000 pounds or more in calendar year 2023. The IRS will accept a taxpayer’s reliance on the incremental cost published by the Department of Energy for the appropriate class of street vehicle.
NADA has also released the following:
A new NADA Regulatory Affairs alternative fuel vehicle and refueling incentive webpage focuses on the Inflation Reduction Act text credits for clean vehicles and refueling infrastructure that start to kick in as of January 1, 2023. The webpage contains sample Seller Report forms and a link to a recordingof NADA’s December 27 Webinar on these tax credits. Dealers should also review important new IRS information on these credits and look out for brand-specific EV tax credit communications from their OEMs.
The maximum amount that Illinois dealers can charge in 2023 for documentary preparation fees is $347.26, the Illinois attorney general’s office announced Dec. 13.
The $23.02 increase over the 2022 maximum fee reflects a 7.1-percent rise in the federal Consumer Price Index for the 12-month period ending Nov. 30. The index is tracked by the U.S. Department of Labor. As always, the DOC fee is taxable and must be substantiated upon request by the attorney general’s office.
The CATA is developing a poster about the DOC fee that dealer members can display. On the poster, the DOC fee amount is left blank for dealers to fill in; any amount up to the maximum allowed may be charged, but all customers should be charged the same amount. Systematically charging one group but not another — all males but no females, for instance — could bring charges of profiling.
Two copies of the poster will be mailed to dealers later this month. For limited additional copies, call the CATA at (630) 495-2282.
IMPORTANT: The new maximum fee cannot be charged before Jan. 1.
The 2023 What Drives Her program returns to the Chicago Auto Show Social Media Preview held Feb. 10 at McCormick Place. This program, now in its fifth year, celebrates women in the industry who are deserving recognition.
At a local level, the Best Retailer award calls on CATA dealers to nominate an extraordinary female at your dealerships.
Best Retailer Award Description: Employed by a Chicago-area dealership, this person demonstrates a high level of commitment and drive to any task at hand, whether that’s in sales, service, finance or technical support.
Last year’s award recipient was Megan Deters, sales manager at Brilliance Honda.
“Megan has worked her way up in this business through hard work, talent and compassion for Brilliance Honda customers,” said Kevin Keefe, owner of Brilliance Honda, who nominated Deters for the award. “One of the faces of Brilliance Honda, Megan is an incredible retailer and one with world class customer satisfaction skills. She brings a positive outlook every day to work and it is contagious amongst the team.”
Nominations are now open for the 2023 awards. Please submit your nominations by January 9.
Click here to submit your nomination.
Chicago Automobile Trade Association (CATA) dealers are at the center of their communities and giving back during the holiday season is no exception to that standard.
From Jeeps on the Run to Fill the Van, dealers across the area rallied their communities to raise money and goods for those in need this holiday season. In its 10th year, Jeeps on the Run, in partnership with Ray Chrysler Dodge Jeep Ram, once again took over the streets of northern Illinois to bring Jeep lovers together for a good cause. This year’s event was a huge success!
Jeeps on the Run and Ray CDJR had a significant impact in their community:
Ray Scarpelli, president of Ray CDJR and Ray Chevrolet, is also in the running for the TIME Dealer of the Year Award. That ceremony is set to take place at the NADA Show this January.
Jeeps on the Run and Ray CDJR aren’t the only ones raising money and collecting items for Toys for Tots. Dealers from across the area are holding toy drives as well including Arlington Heights Ford, Elgin Hyundai and Apple Chevrolet.
Apple Chevrolet hosted its annual Toys for Tots event on Dec. 10 in conjunction with the Marines Toys for Tots Foundation. The day included free food, a live DJ playing holiday music, pictures with Santa, conversations with U.S. Marines and an appearance from ABC 7 Chicago’s Tracy Butler.
By the end of the event they filled three Humvees (large military trucks) with toys for donation.
Advantage Chevrolet of Bolingbrook hosted a “Fill the Van” event this month with the DuPage County Area Project (DuCAP). Now in the 13th year, this partnership sponsors local families in need of food and gifts. The showroom Christmas tree was decorated with families’ wish lists for customers to fulfill.
These are just a few examples of the many generous events happening throughout the Chicagoland area this season. Dealers make a difference and we thank you for all that you do for our communities during the holidays and year-round. Does your dealership or organization deserve to be spotlighted in an upcoming CATA e-Headlines? Let us know.
Tuesday, December 27 | 1pm-2pm ET
Join experts from NADA and the Alliance for Automotive Innovation as they review the vehicles and customers that may be eligible for these tax credits. They'll also discuss how dealers may best obtain the information that must be disclosed at the point of sale, how these credits likely will change in the future, and how to get additional information. This webinar is designed for dealers, new, used, and F&I sales managers, accountants and attorneys. REGISTER.
Chicago Automobile Trade Association18W200 Butterfield Rd.
Oakbrook Terrace, IL 60181
Copyright © Chicago Automobile Trade Association.