As 2024 approaches, the number of electric vehicle models eligible for the $7,500 consumer tax credit in the United States drops to 13 as the Inflation Reduction Act's provisions on sourcing parts from Chinese suppliers take effect. By comparison, the number of electric vehicle models eligible for the EV tax credit as of December 31 last year was 25 under the old standards.
It is understood that the new regulations explicitly exclude vehicles using battery components produced by Chinese manufacturers from tax credits. Looking ahead, U.S. Treasury Department spokesperson Ashley Schapitl said the government will continue to coordinate closely with the auto industry on new restrictions. "Automakers are adapting their supply chains to ensure buyers continue to be eligible for new clean car credits, working with allies and bringing jobs and investment back to the United States," she said.
By 2025, the restrictions will be expanded to include suppliers of key raw materials for batteries such as nickel and lithium, which could put additional pressure on automakers to qualify for electric vehicle tax credits.
Models that are still eligible for the full $7,500 electric vehicle tax credit include Tesla's (TSLA.US) Model Y, Rivian Automotive's (RIVN.US) R1T pickup, Stellantis's (STLA.US) Jeep Wrangler 4xe, General Motors' (GM.US) Chevrolet Bolt and Ford Motor's (F.US) F-150 Lightning pickup. Notably, the popular Nissan Leaf and Tesla's Cybertruck are excluded, but like most other electric vehicle models,