Skip to main content

Battery sourcing guidance might slash EV tax credits

The U.S. Treasury Department’s guidance on battery sourcing requirements for the electric vehicle tax credits will result in fewer vehicles being eligible for full or partial credits, reports Reuters, citing an unnamed U.S. official.

The proposed EV credit guidance as included in the Inflation Reduction Act says that in order for vehicles to qualify for $3,750, which is half of the total credit, 50% of the value of battery components must be produced or assembled in North America. To get the remainder of the credit, 40% of critical minerals must be sourced from the U.S. or a country with which it has a free trade agreement.

The guidance on battery sourcing was meant to kick in on January 1, 2023, but in December the Treasury Dept. decided to hold off until March to give some EV-makers a grace period to meet the requirements.

The Treasury Dept. is expected to share its guidance Friday, and while the Reuters report doesn’t state exactly what it will be, we can guess that the full guidance will kick in, meaning many EVs will lose tax credits or see them cut. The Treasury Dept. is also expected to define key terms like processing, extraction, recycling and free trade deals.

The battery sourcing rules are aimed at helping the U.S. decrease its reliance on China for batteries. While most automakers have been reorganizing supply chains and bringing more processes onshore since COVID, not all will have had the chance to completely upgrade their battery sourcing in time to meet both the Treasury Dept.’s requirements and the increased demand for EVs.

China currently makes 81% of the world’s cathodes, 91% of the world’s anodes and 79% of the world’s lithium-ion battery production capacity, according to data from Benchmark Mineral Intelligence, a market research firm. For comparison, the U.S. has just 0.16%, 0.27% and 5.5% market share, respectively.

Despite the U.S., and most of its free trade agreement partners, being woefully behind China, the Biden administration has said it thinks over time, the tax credit will result in more EVs sold as automakers reorganize supply chains to meet the IRA rules, the source told Reuters.

In February, the Treasury Dept. updated the vehicle classification standard to redefine what makes a vehicle a sedan, an SUV, a crossover or a wagon. The change made more Tesla, Ford, General Motors and Volkswagen EVs eligible for up to $7,500 tax credits. Those vehicles stand to lose some or all of the tax credits once the battery sourcing guidance is out.

Battery sourcing guidance might slash EV tax credits by Rebecca Bellan originally published on TechCrunch



source https://techcrunch.com/2023/03/29/battery-sourcing-guidance-might-slash-ev-tax-credits/

Comments

Popular posts from this blog

Apple’s AI Push: Everything We Know About Apple Intelligence So Far

Apple’s WWDC 2025 confirmed what many suspected: Apple is finally making a serious leap into artificial intelligence. Dubbed “Apple Intelligence,” the suite of AI-powered tools, enhancements, and integrations marks the company’s biggest software evolution in a decade. But unlike competitors racing to plug AI into everything, Apple is taking a slower, more deliberate approach — one rooted in privacy, on-device processing, and ecosystem synergy. If you’re wondering what Apple Intelligence actually is, how it works, and what it means for your iPhone, iPad, or Mac, you’re in the right place. This article breaks it all down.   What Is Apple Intelligence? Let’s get the terminology clear first. Apple Intelligence isn’t a product — it’s a platform. It’s not just a chatbot. It’s a system-wide integration of generative AI, machine learning, and personal context awareness, embedded across Apple’s OS platforms. Think of it as a foundational AI layer stitched into iOS 18, iPadOS 18, and m...

The Silent Revolution of On-Device AI: Why the Cloud Is No Longer King

Introduction For years, artificial intelligence has meant one thing: the cloud. Whether you’re asking ChatGPT a question, editing a photo with AI tools, or getting recommendations on Netflix — those decisions happen on distant servers, not your device. But that’s changing. Thanks to major advances in silicon, model compression, and memory architecture, AI is quietly migrating from giant data centres to the palm of your hand. Your phone, your laptop, your smartwatch — all are becoming AI engines in their own right. It’s a shift that redefines not just how AI works, but who controls it, how private it is, and what it can do for you. This article explores the rise of on-device AI — how it works, why it matters, and why the cloud’s days as the centre of the AI universe might be numbered. What Is On-Device AI? On-device AI refers to machine learning models that run locally on your smartphone, tablet, laptop, or edge device — without needing constant access to the cloud. In practi...

Max Q: Psyche(d)

In this issue: SpaceX launches NASA asteroid mission, news from Relativity Space and more. © 2023 TechCrunch. All rights reserved. For personal use only. from TechCrunch https://ift.tt/h6Kjrde via IFTTT