It's clear that incentives to buy specific cars work best when they can be applied directly at the time of sale.

That's why purchase rebates are widely preferred by electric-car advocates to tax credits, which may take up to 15 months to be usable, depending on the timing of the purchase and tax filing.

While the federal electric-car incentive is an income-tax credit and likely to stay that way, California offers a Clean Vehicle purchase rebate in the form of a check mailed to buyers several weeks after the purchase.

DON'T MISS: To Boost Electric Car Sales, Make $7,500 Tax Credit a Rebate (Jan 2010)

Only about seven out of 10 electric-car buyers in the state use the incentive, according to data covering the Clean Vehicle Rebate Program.

In May 2017, CarsDirect broke the story that California has begun to test a "point of purchase" rebate that can be applied directly to the price of the car during the purchase itself.

On January 30, the the "CVRP Rebate Now" pilot program launched in San Diego.

Car2Go Smart ForTwo Electric Drive in San Diego

Car2Go Smart ForTwo Electric Drive in San Diego

The area was chosen, according to a spokesperson for the California Air Resources Board, because it has dealers for all brands that sell plug-in vehicles.

Also, the Center for Sustainable Energy—which administers the rebate program—is headquartered there, allowing staff to assist in person or monitor transactions if required.

California has made several changes to the its clean-vehicle purchase rebate program over the years, most recently adding income caps on eligibility and boosting the amounts for low-income buyers.

READ THIS: CA Ends Electric-Car Rebates For Wealthy Buyers, Boosts Them For Poorest

The new point-of-purchase system lets buyers interested in purchasing a zero-emission vehicle apply online for preapproval before they make any visits to dealers.

The Center will review and approve the application and supporting documents, and send an approval e-mail to the buyer.

Once that person has visited the dealership, a salesperson will confirm their eligibility for the rebate and apply the rebate amount to reduce the purchase price.

2018 Nissan Leaf

2018 Nissan Leaf

The Center would then reimburse the dealer, rather than the buyer, once the appropriate forms had been completed.

If the San Diego test proves to increase participation and boost electric-car sales, it will likely be rolled out across the state at some point.

CHECK OUT: In an ideal world, this is how electric-car incentives should work


As all car dealers know, "cash on the hood" sells cars—whether it's a discount from the carmaker or, in this case, a state government working to reduce vehicle emissions.

EDITOR'S NOTE: This story was originally published on May 12, 2017, when CarsDirect broke the story that California would test a "point of purchase" rebate that could be applied to the price of the car at the time of sale. We have now updated it to reflect the start of that test in San Diego.


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