Automotive industry annual sales reports

Biden Finalizes EV Tax Rules, Allows $7,500 Credit for Chinese Components Until 2026

May 3, 2024, 01:06 PM

The Biden administration has recently finalized regulations on electric vehicle (EV) tax credits, allowing up to $7,500 for cars with components like Chinese graphite until 2026. This decision is part of the administration's efforts to modify the initial proposals under the Inflation Reduction Act (IRA), which aimed to reduce dependency on Chinese supply chains and boost domestic job creation by encouraging local sourcing of EV components. The Treasury Department's new rules include a detailed process for automakers to trace their battery supply chains to meet domestic content requirements. However, this move has sparked mixed reactions, with automakers welcoming the flexibility, while critics argue President Biden is undermining the IRA's intent.