Looking to cash in on the state’s new instant rebate program for electric vehicles? Several Clark County consumers say they have had trouble getting the rebate program to pencil out at local dealerships.
Unlike federal EV tax credits, which are applied on the buyer’s tax return, the state rebate is applied at the time the car is leased or purchased. For new cars, the rebate amount is $9,000 for a three-year lease or $5,000 for a two-year lease. A $5,000 rebate is also available for new car purchases. For used cars, the rebate amount is $2,500 for either purchase or lease.
When Gov. Jay Inslee announced the program Aug. 1, he said, “Everyone will essentially be able to get one (an EV) for less than $200 a month.”
Vancouver resident and business owner Pawneet Sethi found getting a lease price anywhere close to that was impossible.
Sethi wanted to lease a Tesla Model Y, one of the company’s less expensive models. Where buying a car is a fairly simple process, he admits that leasing is a bit more complicated. But the price he was quoted by Tesla just didn’t make sense, Sethi said.
Typically, at the end of a car lease, the lessor has the option to either return or purchase the car for the residual value of the car. Along with the sales price, the residual value is used to determine the total amount leased and is a percentage of the retail price the seller estimates the car will be worth when the lease expires.
Sethi said he was told the car he wanted would have no value at the end of the lease.
“I don’t know of anyone in the world who says there is no residual value to the car,” Sethi said. “What Tesla is saying is that they don’t have that bottom-line number.”
Without a residual value, Sethi said he couldn’t understand how Tesla could come up with a lease amount. But he was quoted a lease price of more than $430 a month.
The issue seems to be how the lease amount, dealer incentives and rebates are calculated. According to the state Department of Commerce, which is managing the rebate program, if a dealership lists a three-year lease at $259 per month with $2,259 due at signing, the total cost of the lease is $11,324 — or $9,065 (35 payments of $259) plus $2,259. The $9,000 rebate is then applied, bringing the cost of the lease down to $2,324 with a monthly payment of $66.40 (additional taxes and fees would bring the payment to about $103 per month).
“I asked them, ‘So what happened to the rebate money,’ and they said, ‘It’s in there.’ I asked where, and they couldn’t answer that question,” Sethi said.
He said the price he was quoted was closer to the regular price without any incentives or rebates. When he asked for a document showing how the payment was calculated, he said Tesla would not give it to him.
Instead, Sethi said Tesla suggested leasing a Model 3 for about $200 a month, which is close to the state’s estimated price of $174 a month. He said he’s going to keep looking until he finds the right car at the right price.
Tesla declined to comment for this story.
When Nate Brinton from Battle Ground visited car dealerships in Clark County, he said he ran into similar issues. Brinton was interested in leasing a 2023 Subaru Solterra, so he went to Dick Hannah Subaru, which he said was offering a 36-month lease at $199 a month plus $3,650 down.
“The state Department of Commerce advertises (the rebate) as directly off the lease price,” Brinton said. For the Solterra, “the lease price was about $300 a month … and with the rebate it would be about $120 a month.”
Instead, Brinton was told the lease would be $228 a month. Confused by the price difference, Brinton said he asked for documentation of how the price was calculated.
“Initially, they refused to give me the papers. … They said they were afraid it would be used to price match at other dealerships or something,” he said.
After leaving a negative review, he said he received an email asking him to remove the review with the paperwork attached.
“When they switched to the EV rebate, they took away the dealership discounts that made the lease that initial price,” Brinton said.
The Columbian’s calls to Dick Hannah Subaru were not returned.
Brinton contacted the Department of Commerce about his experiences.
“They said it didn’t look like it’s going as planned, and they’re looking to put in regulations or rules for both the consumers and the dealerships to make it work out,” he said.
Commerce spokeswoman Penny Thomas said, as of Aug. 15, there were 818 leases or sales completed using the EV rebates, with an estimated value of $6.2 million.
“We are aware of some questions folks are bringing up. We’ve also had great feedback from satisfied consumers and are pleased with the early success of the program,” Thomas said.
Thomas said the state is reaching out to car dealers to provide additional guidance and support to ensure the rebates are applied correctly and consistently, with extra attention given to cost estimates being provided to prospective customers.
“Car buying or leasing is complicated and presents plenty of variables by dealer and manufacturer even without bringing incentives into the picture,” she said.
Brinton said the pricing information given during Inslee’s press conference, which is also listed on the state’s website, is different than prices he was quoted by different car dealers.
“(The state) had six different vehicles under $150 a month that people could lease. I haven’t found anybody that would give me that price,” he said.
Brinton said he’s put his plans on hold for now but isn’t giving up entirely. He said he may end up traveling to another dealership outside of Clark County if that’s what it takes to get a price closer to what the state is advertising.
