Automakers: US Senate bill to jeopardise 2030 EV targets

WASHINGTON:

A group representing General Motors, Toyota Motor, Volkswagen and other major automakers said a $430 billion bill approved Sunday by the US Senate will put achieving US electric-vehicle adoption targets for 2030 in jeopardy.

“Unfortunately, the EV tax credit requirements will make most vehicles immediately ineligible for the incentive,” said the Alliance for Automotive Innovation’s chief executive, John Bozzella, adding the bill “will also jeopardise our collective target of 40-50% electric vehicle sales by 2030.”

The group had warned Friday that most EV models would not qualify for a $7,500 tax credit for US buyers under the bill.

To be eligible for the credit, vehicles must be assembled in North America, which would make some current EVs ineligible as soon as the bill takes effect.

The Senate bill imposes other restrictions to deter automakers from using Chinese-made materials by phasing in required percentages of North American-sourced battery components. After 2023, vehicles with batteries that have Chinese components could not receive the credit, while critical minerals also face limitations on sourcing.

Senator Joe Manchin, who pushed for the restrictions, said EVs should not depend on foreign supply chains while Senator Debbie Stabenow of Michigan said the credit is “unworkable.”

The bill creates a $4,000 tax credit for used EVs. The package provides billions in new funding for EV production as well as $3 billion for the US Postal Service to buy EVs and battery-charging equipment.

 

Published in The Express Tribune, August 9^th, 2022.

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