Japan auto group concerned about new U.S. tax credit law

U.S. President Joe Biden gives remarks after touring the General Motors 'Factory ZERO' electric vehicle assembly plant in Detroit.

TOKYO Reuters - A major Japanese auto lobby said it was concerned about a new U.S. law that restricts tax credits for electric vehicles to those assembled in North America.

The Biden administration said on Tuesday that about 20 models still qualify for tax credits of up to $7,500. According to the Alliance for Automotive Innovation, there are 70% of the 72 models that were previously eligible for credit.

The auto group added that new restrictions on battery and mineral sourcing and price and income caps will make all or nearly all EVs ineligible on January 1st.

Some major Asian automakers, such as Toyota Motor Corp and Hyundai Motor Co, do not currently produce electric vehicles in the United States.

A spokesman for the Japan Automobile Manufacturers Association said we will keep an eye on future developments and will consider how to respond to them in cooperation with the government.

Toyota referred inquiries to the Alliance for Automotive Innovation, which said the auto industry will continue to work with the U.S. government to promote EV tax credits.