International opposition mounts over proposed U.S. EV tax credit
S E E D E D C O N T E N T
WASHINGTON — The European Union, Germany, Canada, Japan, Mexico, France, South Korea, Italy and other countries wrote U.S. lawmakers saying a proposed U.S. electric vehicle tax credit violates international trade rules, according to a joint letter made public Saturday.
A group of 25 ambassadors to Washington wrote U.S. lawmakers and the Biden administration late Friday saying "limiting eligibility for the credit to vehicles based on their U.S. domestic assembly and local content is inconsistent with U.S. commitments made under WTO multilateral agreements."
The U.S. Congress is considering a new $12,500 tax credit that would include $4,500 for union-made U.S. electric vehicles and $500 for U.S.-made batteries. Only U.S. built vehicles would be eligible for the $12,500 credit after 2027, under a House proposal released this week.
Canada and Mexico have issued separate statements in the last week opposing the plan. The U.S. State Department declined to comment Saturday and the White House did not immediately respond to a request for comment.
The proposal is backed by President Joe Biden, the United Auto Workers (UAW) union and many congressional Democrats, but opposed by major international automakers, including Toyota, Volkswagen, Daimler, Honda, Hyundai and BMW.
A dozen foreign automakers wrote California's two senators on Friday urging them to abandon the plan that they said would discriminate against the state.
UAW President Ray Curry said the provision will "create and preserve tens of thousands of UAW members' jobs" and "would be a win for auto manufacturing workers."
The EV tax credits would cost $15.6 billion over 10 years and disproportionately benefit Detroit's Big Three automakers — General Motors, Ford Motor and Chrysler-parent Stellantis NV — which assemble their U.S.-made vehicles in union-represented plants.
The ambassadors that also include Poland, Sweden, Spain, Austria, Netherlands, Belgium, Cyprus, Ireland, Malta, Finland, Romania and Greece said the legislation would harm international automakers.
They said it "would violate international trade rules, disadvantage hard-working Americans employed by these automakers, and undermine the efforts of these automakers to expand the U.S. EV consumer market to achieve the (Biden) administration's climate goals."
The letter added it "puts U.S. trading partners at a disadvantage."
Autoworkers at the foreign automakers in the countries that wrote are nearly all unionized but not in the United States.
"Our governments support workers' right to organize. It is a fundamental right and should not be used in the framework of tax incentives, setting aside the opportunities for nearly half of America autoworkers," they wrote.
International opposition mounts over proposed U.S. EV tax credit originally appeared on Autoblog on Sun, 31 Oct 2021 12:00:00 EDT. Please see our terms for use of feeds.
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Another giveaway for unions and major US corporations.
Another "unintended" consequence of Democratic policies.
Yer this benefits American workers and consumers!
It doesn't benefit MANY American workers, as the article details.
This also unfairly benefits certain companies while putting others at a disadvantage. Not much to cheer about with this massive giveaway.
Not many poor will be able to afford a new electric car, so no benefit to them at all.
I imagine many rich people will benefit from a $12,500 tax CREDIT.
I don't know how many poor and lower middle class will be able to afford a $30k+ electric vehicle.
I don't consider myself rich but I am comfortable. But I like other single people won't take advantage of such an offer, so there are a lot of people like me who will not benefit from this tax credit.
Until they fix the problem with battery life vs recharge time I will not bother to replace my current car with an electric. I have no need for a second car as I can only drive one at a time anyway and why should I take on the additional expense for a second car that only can be used for short trips around town which for me consist of a weekly trip to the grocery store and maybe a couple of other errands.
More than anything else, I believe this is just a Democratic payback to unions for their political contributions over the years. Otherwise, it would be a credit for any electric cars sold instead of only for ones sold by the Big 3 in Detroit.
Is this the best Biden can do "to restore our standing in the world"?
To "repair our relations with our allies"?
To "regain the respect America deserves"?
Looks like we owe a $450k hurt feelings payment to each Canadian and Mexican, too.
Put that way, this is protectionist on its face. You can’t blame other countries for being pissed.
If this were about the environment and promoting cleaner vehicles, they would give the tax break to people who bought any electric vehicle.
Why can't this be about helping the environment and giving a leg up to American workers and companies who manufacture in the USA? Many "foriegn" cars are already manufactured here...
I thought the right wing was America first. Now because Biden wanted to give a break to American companies they are all up in arms...
Exactly! If Biden is for it they are against it...
Why???
Because this isn't about any of that, really. It is about Democrats paying the unions back for hefty donations, and trying to ensure more union jobs and job security.
And before you try to say it isn't about that, if Democrats were serious about all the things you want to believe this is about, then they would not have extended the credit to only UNION-produced cars.
Democrats and unions can't accept the fact that many folks don't want or need a union.
Be honest. If Trump tried this, Democrats would be screaming right along with other countries about how this is a tariff that threatens international relations and will start a trade war.