The new GM logo is seen on the facade of General Motors’ headquarters in Detroit, Michigan, the United States, March 16, 2021. Portal/Rebecca Cook
WASHINGTON, Aug 5 (Portal) – Most electric vehicle models would not qualify for a $7,500 tax credit for US buyers under a proposal by US Senate Democrats, a group of major automakers said on Friday.
Automakers have privately expressed concern about the proposal’s increasing requirements for vehicle batteries and critical minerals to be sourced from the United States.
John Bozzella, head of the Alliance for Automotive Innovation, which represents General Motors (GM.N), Toyota Motor (7203.T) and Ford Motor, among others, said a July 27 proposal by Senators Chuck Schumer and Joe Manchin would turn 70 % turn off. of 72 electric, plug-in hybrid and fuel cell electric vehicles in the US not permitted to cross.
“None would qualify for full recognition if additional procurement requirements come into effect,” he said.
The automakers want major changes to the proposal, which is part of a larger drug pricing, energy and tax bill.
Without the tax credit, vehicles will become more expensive for American consumers, which could impact demand and sales. It could also slow progress toward President Joe Biden’s goal of having half of all new vehicles sold be electric or plug-in hybrid models by 2030.
Analysis by the Congressional Budget Office on Wednesday found that just 11,000 new electric vehicles would use the credit in 2023. Read more
Manchin and Schumer’s offices did not immediately comment. The Senate could vote on the bill as early as Saturday.
“I don’t think we should build a mode of transportation on the back of foreign supply chains,” Manchin said Tuesday.
The bill includes increasing requirements for the percentage of battery components that are sourced from North America based on value. After 2023 it would ban batteries with Chinese components.
“A more gradual rollout of the battery component, critical minerals and final assembly requirements — which better reflect current geopolitical, sourcing and mineral extraction realities — will preserve credit for millions of Americans,” Bozzella wrote.
Automakers want to expand countries from which to source batteries, battery components and critical minerals to include NATO members, Japan and others.
The new EV tax credits, which would expire in late 2032, would be limited to trucks, vans, and SUVs with suggested retail prices no more than $80,000 and cars priced no more than $55,000. They would be limited to families with adjusted gross incomes of up to $300,000 per year.
Reporting by David Shepardson; Editing by Cynthia Osterman
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