New battery sourcing restrictions would deny Volkswagen, BMW, Nissan, Rivian, Hyundai, and Volvo electric vehicles a $7,500 tax credit, the U.S. Treasury announced Monday.
The Treasury announced Tuesday that the Tesla (TSLA.O) Model 3 Standard Range Rear Wheel Drive will lose half its $7,500 credit to $3,750, although other Tesla models will keep it.
Credit-losing cars On Tuesday are the BMW (BMWG.DE) 330e, BMW X5 xDrive45e, Genesis Electrified GV70, Nissan Leaf (7201.T), Rivian (RIVN.O) R1S and R1T, Volkswagen (VOWG_p.DE) ID.4, Audi Q5 TFSI e Quattro, and Volvo S60. Zhejiang Geely Holding Group owns 82% of the Swedish automaker.
President Joe Biden wants 50% of U.S. new vehicle sales to be E.V.s or PHEVs by 2030. The rules attempt to wean the U.S. off China’s E.V. battery supply chains.
Hyundai said it “will utilize key provisions in the Inflation Reduction Act to accelerate the transition to electrification.”
Rivian did not respond, and the other automakers were unavailable.
Treasury said the General Motors (GM.N) electric Chevrolet Bolt and Bolt EUV would receive the full $7,500 tax credit.
G.M. projected the 2023 Cadillac Lyriq, Chevrolet Equinox EV SUV, and Blazer EV SUV to qualify for the $7,500 tax credit under the new standards. However, Treasury stated all G.M. EVs qualify.
On April 18, Ford Motor (F.N.) and Chrysler-parent Stellantis (STLAM.MI) stated tax incentives for most of their electric and PHEV models would be halved to $3,750. Treasury verified automakers’ figures.
Congress passed the $430 billion Inflation Reduction Act (IRA) in August, requiring the rules last month.
The IRA requires 50% of battery components to be produced or assembled in North America and 40% of essential minerals to be obtained from the U.S. or a free trade partner to qualify for $3,750.
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