LANSING, Mich. — The state launched a new plan that aims to lower the price of vehicles while boosting vehicle sales throughout Michigan.
Governor Gretchen Whitmer made the announcement Wednesday about the new “MI Vehicle Rebate” plan.
The goal is to boost new electric, hybrid and traditional combustion vehicle sales in the state, now that the United Auto Workers (UAW) and the Big Three reached a new contract agreement.
“MI Vehicle Rebate will save you money on your new car as you walk out of the dealership with your keys,” Governor Whitmer said. “Michigan’s auto industry is the backbone of our economy, and this year, the hardworking men and women of the UAW and our world-leading automakers negotiated and ratified a record contract. Now, let’s keep making the world’s best cars and trucks while lowering costs for families by thousands of dollars. Together, we will build and lead the future of mobility and electrification.”
“The future of cars, batteries and tech is being made in Michigan,” Lt. Governor Garlin Gilchrist II added. “The MI Vehicle Rebate plan will lower costs for families, spur vehicle manufacturing and support both our world-class auto workers and our automakers. Governor Whitmer and I are proud of our efforts alongside the UAW to ensure Michiganders are respected and protected at work, and we will continue working to grow Michigan’s economy and cement Michigan as the best place to build a bright future.”
The new state tax rebate will lower the costs of new electric, hybrid or traditional vehicles by between $1,000 and $2,500— the state says this could save Michiganders up to $10,000 when combined with federal incentives.
People in Michigan will receive the tax rebate on new vehicles under the following four categories:
- $2,500 on a new battery electric or hybrid vehicle manufactured in a facility where the workers are represented by an automotive union.
- $2,000 on a new battery electric or hybrid vehicle.
- $1,500 on a new internal combustion vehicle in a facility where the workers are represented by an automotive union.
- $1,000 on all other new internal combustion vehicles.
The MI Vehicle Rebate will not apply to used vehicles.
Governor Whitmer plans to ask state lawmakers to allocate $25 million to fund the MI Vehicle Rebate program during the upcoming State of the State address.
Specifically, she is proposing a tax rebate of $2,500 for a union-made electric or hybrid vehicle or $2,000 for a nonunion-made electric or hybrid vehicle.
A Michigan family could save up to $10,000 off the purchase of a new battery electric vehicle or plug-in hybrid electric vehicle when combined with the $7,500 federal credit.
The governor’s office says the state tax rebate will be applied to the final price of a vehicle at the time of purchase.
Once someone selects the vehicle they intend to buy, the dealership will contact the Department of Treasury to receive a tax rebate voucher.
From there, the licensed new vehicle dealership will subtract the rebate amount from the final purchase price, based on the vehicle’s category and rebate amount.
The plan would then continue until Michiganders use up the full $25 million.
