No Change in Final Assembly and Battery Requirements
The White House released guidelines on the Inflation Reduction Act on Dec. 15. The guidelines include EV subsidy and incentive qualifications and South Korea failed to have its demand reflected in the guidelines.
“The Inflation Reduction Act is one of the most important measures for clean energy development and climate change response,” it said, adding, “The US$370 billion investment based on the act will reduce the United States’ energy costs and accelerate private investment in clean energy to strengthen U.S. supply chains and create jobs and economic opportunities.”
As for the EV-related part of the guidelines, tax credits for EV buyers, the maximum of which is US$7,500, are provided only when the vehicle is finally assembled in the United States with its battery components and minerals satisfying certain requirements as stipulated in the act.
The requirements include the use of minerals supplied from the United States or a reliable trade partner. South Korea demanded a change in the final assembly requirements and a three-year exception for investments in progress, but the United States did not accept any of the demands.