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Automotive Industry
ACEA is disappointed that the United States Congress, as part of the Inflation Reduction Act, has limited the application of tax incentives for electric vehicles on the basis of a number of non-climate related criteria.
Automobile manufacturers are committed to bringing zero-emission technologies to market to assist in the fight against climate change. This is a massive undertaking, so a successful roll-out of new technology, including electric vehicles (EVs), needs support. At this early stage of market development, financial incentives are vital to accelerate consumer uptake of electric vehicles and to create a critical mass for change.
The scope of tax incentives for electric vehicles needs to be far more inclusive in order to achieve the rate of positive environmental change that the automobile sector is committed to, and to reach President Biden’s goal of 50% EV sales by 2030.
The new rules have restricted the eligibility for tax incentives to a relatively small number of vehicles assembled in North America in the short term and, in the medium term, may disqualify any vehicle at all from obtaining such a benefit due to very high local-content rules for batteries.
An EV incentive scheme should be applied in a fair and equitable manner in order to allow all manufacturers the best possible chance of delivering on climate commitments.