Senate proposal on electric-vehicle buyers doesn't require imports

Senate proposal on electric-vehicle buyers doesn't require imports

A Democratic proposal in the U.S. Senate has not allowed buyers of a majority of electric-vehicle models to get a $7,500 tax credit.

A group of major automakers said that's true.

Automakers are privately concerned about the proposal's requirements for vehicles' batteries and critical-mineral contents to be sourced from the United States.

The proposal by Senators Chuck Schumer and Joe Manchin would make 70% of U.S. electric, plug-in hybrid and fuel-cell EVs ineligible upon passage, according to John Bozzella, head of the Alliance for Automotive Innovation.

The group includes Ford Motor, Toyota Motor, and General Motors.

He said that none of the full credit would qualify for full credit if additional sourcing requirements went into effect.

Car makers want significant changes to the proposal, which is part of a larger drug pricing, energy and tax bill.

Without the tax credit, the vehicles become more costly for American consumers.

By 2030, half of all new vehicles sold will be electric or plug-in hybrid models, according to President Biden.

A study by the Congressional Budget Office on Wednesday suggested that only 11,000 new EVs would use the credit in 2023.

Manchin and Schumer's offices did not immediately make a statement. The Senate could vote on the bill as soon as Saturday.

The bill includes increasing requirements for the percentage of battery components originating from North America based on value. It would disallow batteries with any Chinese components after 2023.

The group would rather see a gradual phase-in of the battery component, critical mineral and final assembly requirements.