MyFirstEV, August 2026: the rebate is moving transaction prices

California's MyFirstEV discount takes $3,500 off a new battery-electric vehicle at the point of sale. Because each automaker draws from its own capped allocation rather than a shared pool, the discount is arriving as a series of short, brand-specific demand surges. Tesla's allocation lasted five days. What happens to the transaction price inside those windows is the part nobody is pricing.

The California Air Resources Board administers MyFirstEV, signed into law in July as SB 168. New battery-electric vehicles under $50,000 get $3,500 off at the point of sale. Used EVs under $25,000 get $1,750. Hybrids do not qualify. The pool runs about $271 million, half from the state and half matched by the automakers.

The structure matters more than the amount. That $271 million is divided among roughly thirteen participating brands, each drawing from its own allocation rather than a shared pool. Equal funding against unequal demand.

Tesla's share went live August 3 and was exhausted by August 8, with buyers claiming about half of it in the first three days. Tesla did that while capped. The law waives the price ceiling for California-headquartered manufacturers, which covers Rivian and Lucid but not Tesla, since it moved its headquarters to Texas in 2021. Only base Model 3 and Model Y trims qualified, and the allocation still lasted five days.

The rest arrive in waves. Hyundai, Lucid, Chevrolet, Ford and Kia through August. Toyota, Honda and Subaru in September. Each launch is a demand surge with a known start date and an unknown end.

What we are seeing: a Hyundai store in the Bay Area told us this month that it is now transacting above MSRP on EVs, because the discount brought buyers in faster than inventory is turning. Los Angeles is behaving differently so far. That is one brand in two markets, and it is an observation from our own transactions rather than a published figure.

The mechanism is not mysterious. A point-of-sale incentive with a hard ceiling pulls purchases forward. Days' supply falls. When days' supply falls, discounting subsides. It is what any inventory business does when demand arrives faster than supply.

Three thousand five hundred dollars applied to a vehicle transacting above MSRP is a different outcome than the same amount applied to one transacting below it, and only one of those numbers is printed on the window.