The planned subsidies for electric cars had caused upsets between the USA and the EU.
(Photo: AP)
Washington Shortly before the end of the year, the US Treasury Department specified the new rules for electric car incentives, which are to come into force in spring 2023. The planned subsidies had caused resentment between the USA and the European Union because they envisage market barriers for foreign car manufacturers.
In concrete terms, the USA is now making concessions to the EU on an important point: electric, commercial leasing vehicles should also be able to be subsidized with tax credits of up to 7500 US dollars in the future.
As a result, European electric cars leased in the US can also benefit from the incentives. The German car manufacturers in particular would benefit from this, as they tend to target an upscale clientele. In the run-up, the European Union had tried to find a leasing solution. According to Brussels, it would cover a large part of European e-car exports to the USA, probably well over half.
From next year, the USA wants to promote the purchase of electric cars with up to 7,500 dollars per vehicle – but only if the models were mainly manufactured in the USA. Europeans fear that their companies will be systematically disadvantaged by the strict regulations.
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The electric stimulus goes back to the Inflation Reduction Act (IRA), which US President Joe Biden signed into law in August. It is scheduled to come into force on January 1, 2023 and contains numerous “Made in America” regulations. To qualify for the full tax credit, future EVs sold in the US must be assembled in North America. Also, electric vehicles must source a significant portion of their battery components and minerals from the United States or from countries with which the United States has free trade agreements. This effectively excludes imports from the EU.
European car manufacturers are gaining time
The dispute over e-car incentives has not yet been finally resolved. The USA has postponed the start of the planned tax incentives by several months, until at least March 2023. This will give European automakers some time to adapt to the regulations. On the other hand, the postponement also means that not all details have been finally clarified – which creates new uncertainty among manufacturers and consumers.
The leasing solution is now at least a loophole with which European car companies can partially circumvent the new rules. Democratic Senator Joe Manchin, chairman of the Energy Committee, therefore sharply criticized the Treasury Department.
The authority would have “bowed to the wishes of companies looking for loopholes,” he said on Thursday. The law is being “carelessly interpreted,” he warned, and is in danger of losing its desired effect: namely that American companies and production in particular will benefit from the incentives.
Overall, the IRA includes $ 370 billion, which should flow mainly in the form of tax rebates. Anyone who produces wind turbines or green hydrogen in the USA, who buys an electric car or puts a solar panel on the roof will in future be rewarded by the state. However, only if the products, or at least essential parts, were manufactured in the USA.
More: Where once heavy industry was stunted, electromobility is now booming. A new “Battery Belt” is being created in the USA – an enormous feat that also entails risks.