It Should Get Easier to Buy an EV That Meets IRA Tax Credit Rules

• President Biden and European Commission President Ursula von der Leyen met last week to discuss, among other topics, “building the clean economies of the future.”

• The US and EU will “deepen our cooperation on diversifying critical mineral and battery supply chains” by “recognizing the substantial opportunities on both sides of the Atlantic,” a joint statement read.

• Within the US, a battery assembly ecosystem is building up in the South and Midwest, with much concentration in Georgia. (Ultium battery for Cadillac Lyriq EV is pictured above.)

There was very little confidence any automaker could reach the North American electric-vehicle content detailed in the Biden administration’s clean energy component of the Inflation Reduction Act proposal last August.

Automakers would have to source and process 40% of “critical mineral and battery” components by 2024, ramping up to 80% by the end of 2026, from North America or a US free trade partner.

President Biden acknowledged “glitches” in the legislation in a meeting last November with French President Emmanuel Macron. After Congress passed the IRA in 2022, the newly formed Joint Office of Energy and Technology began tweaking EV incentive details. Meanwhile, the European Commission objected to its “protectionist” provisions.

That culminated in a meeting in Washington between Biden and European Commission President Ursula von der Leyen last Friday, March 10. They discussed “standing together to end Russia’s war against Ukraine,” “strengthening economic security and national security,” and “building the clean economies of the future.”