The US Treasury has officially put new rules into place related to the revamped US EV tax credit that comes as part of the Biden Administration's Inflation Reduction Act. With the new rules now made official, the Treasury shared that BMW, Hyundai, Nissan, Rivian, Volkswagen, and Volvo will lose credit eligibility. More specifically, these brands have no access to any portion of the $7,500 credit, at least initially.
Meanwhile, most brands and EVs are impacted by losing just half of the total credit. This means they'll still qualify for one $3,750 portion of the credit. We did know in advance from Tesla that the cheapest Model 3 would lose $3,750 in potential credit eligibility since it uses different battery cells than other Tesla EVs, and they're not sourced domestically or from a country with which the US has a free trade agreement.
In the end, the goal of the new rules is to make the US more independent of other countries as it moves forward with EVs. In addition, the US government hopes to lure electric car and battery producers to our shores.
Tesla investor Sawyer Merritt put together the following lists based specifically on the USA Department of Energy's EPA fuel economy website:
As you can see, the Treasury is currently indicating that only nine EVs in the US will no longer qualify, and they're all produced by foreign automakers, aside from Rivian's vehicles. Eleven vehicles will still qualify for the full credit, though three of those EVs are coming from GM and haven't yet arrived to market.
It's somewhat comforting to know that, aside from the base Model 3, the most popular EVs on our shores still qualify for the full $7,500. As pointed out by Merritt, Tesla sold nearly five times more Model Y crossovers in the US in 2022 than all the other non-Tesla EVs on the list combined.
Tesla is also still dropping its prices, so for people who want to get into an electric car or SUV and hoped to get the full credit, there are certainly still options. If you want an electric pickup truck and hoped for the full $7,500 credit, you can choose the Ford F-150 Lightning and opt for either battery pack.
Merritt's final list shows the EVs that still qualify for half the credit ($3,750), and the list includes some plug-in hybrid electric vehicles (PHEVs). He also includes the link to the US Department of Energy's webpage related to the tax credit, and a list showing that some PHEVs still get the full $7,500 credit, which we've already pointed out is interesting and arguably concerning since these vehicles still burn lots of gas.
Once you've had a chance to check it all out, head down to our comment section and start a conversation. Did it turn out as you expected? Are there EVs missing from the preliminary lists that you had hoped to see here? Leave us your thoughts below.
