"The Biden administration hopes its guidelines for up to $7,500 in tax credits will encourage automakers to reduce their reliance on China for batteries and raw materials."
"The Biden administration on Friday released new rules that will significantly shorten the list of electric vehicles that qualify for federal tax credits. Officials hope the change will push carmakers to move their supply chains out of China and to the United States or its allies.
The rules, issued by the Treasury Department, are a result of the Inflation Reduction Act, which Democrats passed last year to fight climate change by encouraging the use of zero-emission vehicles and green energy. The law also seeks to reduce the industry’s reliance on China, which makes most of the world’s batteries and dominates the processing of critical raw materials.
For purchases of their electric cars to qualify for up to $7,500 in tax credits, automakers must meet strict requirements for where they assemble the cars and batteries and where they get the materials that go into batteries. Only a handful of vehicles are expected to qualify for the full credit when the rules, which are more stringent than previous requirements, go into effect April 18, down from 21 now."
Ana Swanson and Jack Ewing report for the New York Times March 31, 2023.
SEE ALSO:
"Biden EV-Sourcing Rules Leave Few Autos Eligible for Credits" (Bloomberg Environment)
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