In 2022, Congress handed the $430 billion Inflation Reduction Act barring future electric-vehicle tax credit if any battery elements are manufactured or assembled by a “foreign entity of concern.”
The international entity of concern guidelines are aimed toward weaning the United States from Chinese provide chains and are available into impact in 2024 for accomplished batteries and 2025 for important minerals used to supply them. The query is how what exactly constitutes a “foreign entity of concern” and to this point no international battery provider has been labeled as such.
Smith requested Musk whether or not, other than boosting North American manufacturing, his firm had “taken any actions to increase production of the number of vehicles that will qualify for the clean vehicle credit?”
Smith additionally wrote Nissan on Tuesday asking for particulars about its battery suppliers and whether or not its U.S. manufacturing plans “include the production of batteries or battery components for EVs?”
Tesla and Nissan didn’t instantly reply to requests for remark.
In July, Smith and Mike Gallagher, Republican chair of the Select Committee on China, demanded Ford reply questions concerning the CATL deal.
“We are concerned that the deal could simply facilitate the partial onshoring of PRC-controlled battery technology, raw materials, and employees while collecting tax credits and flowing funds back to CATL through the licensing agreement,” the letter to Ford mentioned.
Ford instructed Reuters Tuesday it agrees that “U.S. taxpayer dollars should support American manufacturers, not foreign entities of concern.” It defended its deliberate battery plant as “one owned and controlled solely by Ford, a proud American company.”
Ford is awaiting steerage from the U.S. Treasury to make sure the partnership doesn’t run afoul of the Act.
Smith wrote Treasury Secretary Janet Yellen Tuesday saying she ought to instantly concern the steerage and “make clear in the most comprehensive way possible that taxpayer subsidies cannot flow to foreign entities of concern through any structuring mechanism conceivable.”
Source: www.autonews.com