Treasury lets automakers do the math on EV tax credit eligibility
Rather than make calls now picking one priority over the other, Treasury bought itself more time by punting the ball back to industry. The guidance officials published on April 17 wasn’t much different from the white paper they put out in December. The administration kept the language vague to give automakers flexibility in determining their own compliance, said Manish Dua, a senior analyst at Benchmark Mineral Intelligence. “The government has tried to be more accommodative,” he said.
In short, car companies are doing their own math for now, and they’ll come back to Treasury between now and June with more comments on how they think this should work. The list of eligible vehicles makes for interesting shorthand on how much of your EV orThis era of self-determination won’t last forever, and it doesn’t necessarily mean Treasury is going soft on China.
One of the crucial questions still pending is what constitutes a foreign entity of concern. This will determine just how much China is carved out of America’s EV supply chain by saying, for example, whether offtake from a Chinese lithium joint venture inTreasury has outsourced this question to the Energy Department, which has been gathering data from the auto industry on battery costs for years. In other words, they’re no rube.
Some observers have pointed to the Commerce Department’s action on FEOC language for semiconductors as a hint that officials will take a hawkish approach. Treasury Secretary Janet Yellen’s comments this week on the primacy of national security over economic costs vis a vis China certainly point in that direction. It probably will be months before we see where they land.
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