Electric Vehicle Incentives Repeal: A Blow to the Industry and the Environment

If passed into law, the Republican-led legislation to repeal electric vehicle incentives would deliver a significant blow to the growth of the technology in the United States, slowing sales and production of battery-powered cars and trucks. The measure would repeal many of the subsidies that have been critical to the growth of electric vehicles, including a $7,500 tax credit for the purchase or lease of electric cars and trucks. The rollback of sales incentives would leave the United States trailing behind China and Europe, where electric vehicles make up a larger percentage of new car sales and are growing faster.

Key Takeaways:

• The Republican-led legislation would repeal electric vehicle incentives, including a $7,500 tax credit for the purchase or lease of electric cars and trucks, and a $250 annual fee on owners of electric vehicles.
• The repeal of incentives would slow the sales and production of electric vehicles in the United States, with estimates suggesting that automakers would sell eight million fewer electric vehicles by 2030.
• The elimination of federal subsidies would raise prices for electric vehicles in the United States, making them less competitive with their gasoline-powered counterparts.
• The legislation would also undermine the growth of battery manufacturing and mining projects, preventing the creation of new jobs and industries in the United States.
• The zero-emission transportation association believes that the bill as currently written would be "devastating" for critical mineral production and refining in the United States.
• The International Council on Clean Transportation estimates that the Inflation Reduction Act would create 118,000 jobs through 2030, while the repeal of the legislation would result in 130,000 jobs lost.

Statistics:

• 3.3 million electric vehicles were sold in China from January through April, a 35% increase from a year earlier (Rho Motion).
• 1.2 million electric vehicles were sold in Europe during the same period, a 25% rise (Rho Motion).
• 600,000 electric vehicles were sold in North America, a 5% increase (Rho Motion).
• The repeal of electric vehicle incentives would result in 130,000 jobs lost, according to the International Council on Clean Transportation.
• The Inflation Reduction Act would create 118,000 jobs through 2030, according to the International Council on Clean Transportation.

Sources:

• Rho Motion
• Edmunds.com
• International Council on Clean Transportation
• University of Illinois
• Senator John Barrasso
• White House
• Ford Motor
• King & Spalding
• Morgan Lewis
• NYTimes (Andrew E. Kramer and David E. Sanger, September 11, 2023)