U.S. Senate Passes Climate Bill with EV Tax Credits, But Some Automakers Aren’t Happy
A major lobbying group representing major automakers General Motors, Toyota, Volkswagen and others has said the newly passed U.S. Senate bill including tax credits for electric vehicles (EVs) could jeopardize climate targets.
The $430 billion bill approved by the U.S. Senate on Sunday could stop automakers from reaching EV adoption targets by 2030, one senior executive for a large vehicle lobbying group said in a report from Reuters.
The new Inflation Reduction Act of 2022 was passed after a marathon voting session that went nearly 24 hours, with Vice President Kamala Harris breaking a 50-50 tie to pass the climate bill.
Chief Executive for the Alliance for Automotive Innovation John Bozzella said the new $7,500 EV credit requirements would eliminate EV eligibility for most vehicles.
In a statement, Bozzella said, “Unfortunately, the EV tax credit requirements will make most vehicles immediately ineligible for the incentive.” He added that the bill “will also jeopardize our collective target of 40-50% electric vehicle sales by 2030.”
In order to qualify for the credit, EVs must be assembled in the U.S. and must have minimal Chinese battery components starting in 2023. Eligible vehicles also must have a percentage of battery pack minerals from North America.
The EV tax credit is set to expire in 2032, and offers a $7,500 EV credit to North American-made cars up to $55,000 and vans and trucks up to $80,000.
Households with an adjusted gross income up to $300,000 per year are eligible to receive the credit on EV purchases.
-= Breaking Down The Clean Vehicle credit =-
Many claims have circled about the amended credit:https://t.co/OKY9ltKaY8
Does it reward hybrids? Does it favor H2? Does it benefit dealerships? Is it impossible to meet? Is Tesla at a disadvantage? Let's break it down.
— Nafnlaus 🇺🇦 🇮🇸 (@enn_nafnlaus) August 8, 2022
Used EVs may be eligible to receive a $4,000 tax credit, and the bill also includes around $3 billion to electrify the U.S. Postal Service’s fleet.