The Treasury Department is writing rules for the federal EV tax credit that some think are not in line with the intent of the IRA.
, a car must be finally assembled in the US, and cost less than $55,000 for a sedan or wagon, or less than $80,000 for an SUV or light duty truck. There are rules coming that will require the batteries in those cars to use materials and components sourced within the US or from a country that has a free trade agreement with the US, but the Treasury Department says it needs more time to create the rules and regulations that will implement those provisions.
Their arguments have a stinger in the tail. If the US persists with these rules, which they claim violate any number of World Trade Organization rules, there will be consequences that could hurt US companies. Diplomacy is all well and good, but it helps to have a club in your back pocket in case you need it.