Lawmakers are pushing for changes to recent EV tax credit requirements signed into law in August, with the hope of delaying stipulations on manufacturing and material sourcing.
According to a recent report from Automotive News, Democratic Senator Raphael Warnock introduced a bill in September that would provide an extended phase-in period for the new EV tax credit with regard to the North American final assembly requirement and mineral / battery component sourcing requirements. Warnock will face Republican challenger Herschel Walker in a runoff election next month.
The new bill, titled the Affordable Electric Vehicles for America Act, is supported by three House Democrats, U.S. Reps. Eric Swalwell of California, Terri Sewell of Alabama, and Emanuel Cleaver of Missouri, who introduced a companion bill this month. All three House lawmakers won their respective midterms reelections.
Under the Inflation Reduction Act signed into law by President Joe Biden in August, EVs must be assembled in North America in order to be eligible for the new tax credits. Additionally, the rules include increased sourcing requirements for battery materials and components, restricting the use of content from “foreign entities of concerns,” as well as stipulate greater use of materials from countries with an established free trade agreement with the U.S.
However, an array of major automakers and foreign governments have weighed in on the EV tax credit requirements vying for exemptions, including the Japanese government and Toyota, which have stated that U.S. allies like Japan should be treated “no less favorable” than North American countries with regard to assembly locations and mineral supply chains.
South Korean automaker has also insisted that its vehicles should be exempt from the requirements until the completion of its new $5.54 billion EV and battery plant in Georgia. The new Georgia facility will produce Hyundai, Genesis, and Kia models, and is estimated to create 8,000 new jobs when it opens in 2025.
Last month, the U.S. Treasury Department announced it was seeking input as it moved to implement the new EV tax credit rule changes. The U.S. Treasury will issue guidance by December 31st that further defines credit eligibility restrictions.
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Comments
All this is is a way for manufacturers to make more profit on EV’s. They’ve already compensated in the price of EV’s and they need no motivation to make EV’s as it is because EV vehicles have the longest waiting list.
So scrap the whole idea. I don’t want my tax money to line Ford or GM’s pockets. They’re greedy enough.
Agree to some extent but have you not been tracking what oil companies are doing to the public too? So get rid of their tax breaks after 100 years too!
It’s hard to argue that point. I think the subsidies should have been focused on lower income folks and cheaper vehicles. The current vehicle price caps and income caps are too high. As Mr. Mike points out, there is no shortage opf demand for the 50-150k vehicles. Lowing the caps would drive manufactures to produce smaller, cheaper cars and get more heavily polluting older clunkers which tend to be in lower income driveways off the road faster. After all, the goal is to lower emissions and reinforce us manufacturing, right?
That’s funny, you don’t mention the Asians..
They blood suck off the American Government like the leaches they are.
They are funded by their prospective governments as well.
That’s why we only have two automotive companies left.
We used to have hundreds. We Americans love to be taken advantage of it seems.
hundreds of what?
“vying for exemptions, including the Japanese government and Toyota, which have stated that U.S. allies like Japan should be treated “no less favorable” than North American countries ”
Toyota and the Japanese government can go to He**. Until they fully open their market and strip away the restrictions that make it totally unfavorable for US companies to truly sell in Japan, then they can go pound sand.
This bill was signed exactly like it should have been and should stay.
They are not being treated less favorably. Clean vehicles made by North American Companies don’t qualify if they aren’t built in North America, either. And all these foreign companies already have manufacturing and final assembly plants in the US, but they need to convert them to EV production.
I have a deposit on the Chevy Blazer EV SS. Not getting the $7500 tax credit could change my mind.
Might not qualify for the full amount right off the bat. GM expects their EVs to qualify for 1/2 the amount first year, but maybe not full amount until 2024/2025.
“We think, out of the gate, we’re going to be eligible for the $3,750, and we’ll ramp to have full qualification in the next two to three years, getting up to the $7,500,” Barra said. “It just takes a couple of years to ramp up based on our expectations with the supply moves that we’ve already made.”
The lies, big or not, continue. Knew darn well the “only american made” would not stand. The govt. wants to push this agenda as hard and fast as possible,
It’s not American made it’s American produced any auto maker can qualify just build in the USA and get the minerals required sourced within the requirements.
If this all sticks they need to treat the car claim on ones taxes like solar…that is the difference roles over year to year until its used up by the tax payer based on their taxes owed. Yes eventually the dealer will be allowed to directly deduct but those pigs will simply take it all by jacking up prices. That is the problem with trying to transition…THEY ARE ALL DOING it in solar, heat pumps and now cars.
Toyota already builds hybrids here, but not any of their plug-ins. Shouldn’t be hard for them to convert their plant in Kentucky that makes the RAV4 to build the the RAV4 Prime. So it can qualify.
If they do it, should be premised on those automakers actually building in North America at some timeline in the future. So basically, can give taxpayers the credit on imports, but if the automaker fails to bring production to North America, the automaker needs to pay that back. Give them say 2 years, which is about how long it takes to build a new factory.
Or make it a 1:1 deal. For every qualified plug-in built in North America, they can apply an equal credit to an otherwise qualified imported plug-in.
I’m not opposed to a phase-in adjustment to the clean vehicle credit. But I doubt this would be able to pass in the current political environment and we don’t know yet how the midterms are going to shake things up.
Since we’re on a GM focused site I think we should give credit to GM for basically giving all Bolt buyers the “tax incentive” w/o using government money. The $6k off of the Bolt EV and EUV is coming out of GM’s pocket and while I’m quite sure it’s not 100% altruistic on their part, it is putting your money when your mouth is.
My wife’s new Bolt is sitting on a rail car in Dalhart TX this AM on it’s way to Santa Fe, NM. Should be at the terminal in Santa Rosa, NM today or tomorrow. It’s the EV and fully loaded at $32k. It has 260 miles of *real world* range which about 40 miles less than my $65k Model Y LR which no matter what Tesla says has a *real world* range of closer to 300 miles, not the advertised 330. The Bolt is best small EV money can buy today and demand is surging but GM is holding the line on the $6k price cut in 2023. Kudos to GM for making it affordable to a big chunk of the population. I know folks will say they had to do this to recover from the LG battery debacle but so what, they are doing it and this car is a huge value at the current sales price thanks to GM stepping up and making the subsidy available on their own dime.
I’m going to reply to my own comment here. The real test for GM’s generosity and altruism will be if the current pricing holds when the Bolt becomes eligible for the tax credit again in 2023. Me thinks thats unlikely but I hope I’m pleasantly surprised even though I’ll probably kick myself for not waiting to buy until it came back.
jack: I ordered my 2023 Bolt EV (not EUV) last week. I wanted exactly the vehicle without all the junk dealers like to add. So I ordered the 1LT Bolt with all weather mats and the two packages bringing the total MSRP to $28,285.00. I placed the order in hopes that it will be here between February and April of 2023. This would allow it to be eligible for the $3,750.00 federal tax incentive along with the $2,000 California tax incentive. That would bring the net MSRP down close to $22,500 for a still well equipped brand new Bolt. How could I pass on that?
So now the big question will be if the car still comes in at the $28,285.00 MSRP AND if I can get that $3,750.00 incentive together. I hope so!
I ordered the light blue color and my plan is to have the ugly black plastic around the wheels and bottom painted in either matching color or maybe go with a darker blue for a slight two-tone effect.
Awesome Dan…. I’ve spent some serious time behind the wheel of the bolt…. You just can’t beat it for the $$$
Won’t impact my ICE purchases.
Hey Carl…. Someone has to pull up the rear in the transition to Electric.. Best of luck!
Yes you get to pay full price with no discounts or tax breaks. Plus play the gas pricing game than goes up and down 300% in a year. But it’s fine there are not enough EV’s to go around yet.