California launches instant electric vehicle subsidy, first-time car buyers can receive $3,500
California Governor Gavin Newsom signed SB 168 on Monday, officially launching the "My First Electric Car" subsidy program to provide instant car purchase discounts to the first electric car buyers. The program consists of US$135.5 million in state government funding and equal matching funds from multiple automakers, with a total scale of approximately US$270 million. The new subsidy is applicable to new cars with a suggested retail price of no more than $50,000, and second-hand electric cars with a price of no more than $25,000 (subsidy of $1,750), aiming to target subsidies to the mass market rather than high-end models. Compared with the previous round of plans that ended in 2023, this round of subsidies is specifically limited to first-time car buyers to maximize the attraction of new users and expand the electric vehicle consumer group. The plan is a direct response to the federal government's repeal of the $7,500 electric vehicle tax credit. Data show that U.S. electric vehicle sales have declined after the elimination of federal subsidies. In 2025, electric vehicles will account for only about 7.8% of new vehicle sales, down from 8.1% in 2024. California is the largest electric vehicle market in the United States, accounting for about one-fifth of national electric vehicle sales last year. The list of automakers participating in the program is expected to be announced next month. California is responding to the policy reversal at the federal level through a three-pronged approach of subsidies, litigation and backup regulatory standards.