WASHINGTON, Sept 12 (Askume) – The U.S. House of Representatives voted on Thursday to pass legislation to tighten rules limiting Chinese content in cars eligible for U.S. electric vehicle tax credits.
The House of Representatives passed the bill by a vote of 217 to 192, but the Senate has not yet taken up the bill. It aims to tighten the definition of Chinese parts so that vehicles are ineligible for US electric vehicle tax credits.
The Alliance for Automotive Innovation, which represents General Motors Co (GMN) , Toyota Motor Corp (7203.T) , Volkswagen AG (VOWG_PDE) , Hyundai Motor Co (005380.KS)
and other car companies, said the bill would result in fewer eligible vehicles and mean it would roll back strict regulations on vehicle emissions and electric vehicle targets.
The automaker’s group chief executive, John Bozzella, said the standards were partly based on the availability of electric vehicle tax credits and that if the incentives were removed, “the auto industry base would face serious economic and national security risks from China. The United States would not have competition, and consumers would be stripped of their living space.”
The bill, sponsored by Representative Carol Miller, would tighten the definition of so-called “foreign entities” that apply to China and other countries. She said this would “ensure that Chinese companies will no longer be able to take advantage of electric vehicle tax credits for American manufacturers.”
Regulations required by the August 2022 legislation are aimed at shifting the US electric vehicle battery supply chain away from China.
The US Treasury Department and the Chinese Embassy in Washington did not immediately comment.
Bozzella said there are currently 113 electric vehicles available for sale in the United States. Or one of 22 EV plug-in hybrid models eligible for the tax credit – only 13 received the full $7,500 tax credit.
In May, the US Treasury Department gave automakers additional flexibility in battery mineral requirements to enable EV tax credits on certain critical minerals such as graphite imported from China .
The department said vehicle manufacturers will be required to remove certain hard minerals, such as graphite contained in anode materials and critical minerals contained in electrolyte salts, binders and additives, by 2027.
