The CEOs of General Motors, Ford, Stellantis and Toyota Motor North America are urging the U.S. Congress to lift the federal government’s cap on the number of vehicles that are eligible for a tax credit of up to $7,500 from the current 200,000 vehicle cap.
In a joint letter Monday to congressional leaders, the executives say the credit, which begins phasing out once a company sells 200,000 plug-in electric vehicles, is essential to keep the vehicles affordable as production and commodity costs rise. The letter reads: “Eliminating the cap will incentivize consumer adoption of future electrified options,” as signed by GM’s Mary Barra, Ford’s Jim Farley, Stellantis’ Carlos Tavares and Toyota North America CEO Tetsuo Ogawa.
“We ask that the per-(automaker) cap be removed, with a sunset date set for a time when the EV market is more mature,” the automakers continue, explaining that “Recent economic pressures and supply chain constraints are increasing the cost of manufacturing electrified vehicles which, in turn, puts pressure on the price to consumers.”
Opposition to the initiative is strongly backed the resident oil and coal industries, championed by Senator Joe Manchin from West Virginia, who countered: “There’s a waiting list for EVs right now with the fuel price at $4. But they still want us to throw $5,000 or $7,000 or $12,000 credit to buy electric vehicles. It makes no sense to me whatsoever.” Manchin also opposed Biden’s proposed EV tax credits, as they were offered with a union-only caveat, which, for example, would have blocked Tesla from receiving subsidies. The bottleneck that Manchin spoke of even resulted in the Biden administration getting creative and pulling out a 1950’s era regulation for battery supply.
Interestingly enough, Toyota recently came under fire for lobbying for fossil fuels in the USA, with a petition on the internet gaining over 110,000 signatures in a day. It seems that Toyota is attempting to leverage both markets at the moment, which could turn out to be a pricey strategy in the long run.
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