Ford's Fusion-Mercury Milan Hybrids OK'd for $3,400 Federal Tax Credit
By John O'Dell January 28, 2009But Cars Not Available Yet and Credit Falls to $1,700 on April 1 and Disappears Next Year
The 2010 Ford Fusion hybrid (left)
- and its Mercury Milan twin - have been approved for the new $3,400 federal tax credit for hybrids, but the deal's only good for models sold through March 31.
That likely means there won't be many sold that qualify for the full credit because Ford won't be getting the cars to showrooms until sometime in the spring. That could be early March, said a company spokeswoman, but it could be later.
Ford says, though, that people who are interested in securing the full credit can qualify if they have a car ordered through a dealership by the end of March..
After that, the credit drops to $1,700 because Ford has hit the hybrid sales threshold that triggers a rapid phasing out of the hybrid tax credits.
The automaker, though, plans to take full advantage of the marketing advantage it gains by being able to advertise the biggest tax credit ever for a conventional hybrid.
That's because the feds only allowed a top credit of $3,000 for hybrids sold before the 2010 model year. Front-wheel drive versions of the Ford Escape and Mercury Mariner hybrid SUVs both still qualify for that credit until April 1. The SUV hybrids with four-wheel drive are eligible for a $1,950 credit through the end of March.
After falling 50 percent on April 1, Ford Motor Co.'s hybrid tax credits drop by 50 percent again on October 1 (the Fusion credit, for instance, will be $850 at that point) and disappear on April 1, 2010.
Ford already is hyping the Fusion-Milan tax credits as "the highest credit amount ever offered for hybrids purchased or placed into service after Dec. 31, 2005." You can expect some version of that claim to start showing up in advertising soon.
The reason, of course, is simply that Ford's the first manufacturer still eligible for the incentives to launch a 2010 model year hybrid that qualifies for the recently increased credit.
Toyota and Honda have already sold so many hybrids that they've used up the tax credits allocated to them, so neither the 2010 Honda Insight, although a new model, nor the 2010 Toyota Prius, an update, will be eligible for a federal credit.
It was the Fusion's EPA-estimated fuel economy of 41 miles per gallon in the city and 36 mpg on the highway that qualified it for the big credit, which is based on fuel efficiency.
John O'Dell, Senior Editor
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I'm not sure the claim in this article is true- I have been eagerly awaiting my Escape Hybrid since I ordered it in August of 08; I have been worried that the dealership won't deliver mine before April-the IRS uses this criteria for determining which credit the customer gets:
"The date of purchase determines the amount of the credit available for a vehicle, i.e. whether a vehicle is eligible for the full credit or whether a portion of the credit is phased-out."
The way Ford's order system works is that they take a deposit for the vehicle, and you complete the purchase of the vehicle on delivery. You don't actually purchase your vehicle at the time of order because (as was the case with me) you could be waiting for months before you take delivery.
Roguelegend...
Hmm, I was repeating what Ford assured me was the case. I'll go back and double check with them. Would be something less than funny if they have a car that qualifies for $3,400 and they can't get it into customers' hands in time!
I can't find a dealer in Atlanta that will even take an order. Dealerships in Dearborn say they can't get them by April 1 but at least will take an order. SoCal dealerships, which supposedly will get the first batch, are either clueless or won't return calls.
Doesn't look good getting the $3400.
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