Treasury’s decision to largely stick with what it spelled out in December is likely to please congressional supporters like Sen. Debbie Stabenow, D-Mich., who were concerned that a more stringent reading of Democrats’ climate, tax and health care law could choke off electric vehicle sales.
Groups representing electric vehicle manufacturers welcomed the clarity from Treasury on Friday.
John Bozzella of the Alliance for Automotive Innovation, a major trade group for automakers, said in a blog post that he expected few models of electric vehicles currently on the market will be eligible for the full $7,500 credit in mid-April. But he said Treasury has « done as well as it could to produce rules that meet the statute and reflect the current market, » given what was written into the climate law.
The law got rid of a limit on how many electric vehicle tax credits can be used to buy specific manufacturers’ cars after some major U.S. companies, including General Motors Co. and Tesla Inc., hit the cap while others were nearing it. But to get centrist Sen. Joe Manchin III, D-W.Va., on board, the law added new sourcing rules that escalate in the coming years in an effort to force supply chains currently dominated by China to instead run through the U.S. and friendly nations.
Manchin has pressed Treasury to get the sourcing requirements in place faster and adhere to a strict reading of the rules as he weighs whether to run for reelection next year in what Inside Elections with Nathan L. Gonzales rates a battleground race.