By Michael Elkins
The U.S. Treasury announced Monday that automakers Volkswagen (ETR: VOWG_p ), BMW (OTC: BMWYY ), Nissan (OTC: NSANY ), Rivian Automotive Inc (NASDAQ: RIVN ), Hyundai Motor Co (OTC: HYMTF ) and Volvo's (OTC: VLVLY ) electric vehicles will lose access to a $7,500 tax credit under the new rules for battery sourcing.
The Treasury also said the new requirements, which go into effect on Tuesday, will cut credits for the Tesla Inc (NASDAQ: TSLA ) Model 3 Standard Range Rear Wheel Drive by half to $3,750, but that other Tesla models will retain the full $7,500 credit.
Vehicles losing credits on Tuesday are the BMW 330e, BMW X5 xDrive45e, Genesis Electrified GV70, Nissan Leaf, Rivian R1S and R1T, Volkswagen ID.4 as well as the plug-in hybrid electric Audi Q5 TFSI e Quattro and plug-in hybrid electric Volvo S60.
The updated rules are aimed at reducing U.S. dependence on China for EV battery supply chains and are part of President Biden's effort to make half of U.S. new vehicle sales by 2030 EVs or PHEVs.
Hyundai Motor Co said in a statement it was committed to its long-range EV plans and that it "will utilize key provisions in the Inflation Reduction Act to accelerate the transition to electrification."
VW said it was "fairly optimistic" the ID.4 SUV will qualify for the tax credit. "We are awaiting the proper documentation from a supplier to determine its eligibility for the credit," the German automaker said.
Treasury also disclosed General Motors' (NYSE: GM ) electric Chevrolet Bolt and Bolt EUV will qualify for the full $7,500 tax credit.
GM said earlier it expected at least some of its EVS would qualify for the $7,500 tax credit under the new rules, including the 2023 Cadillac Lyriq and forthcoming Chevrolet Equinox EV SUV and Blazer EV SUV. The Treasury said all GM EVs will qualify.
Earlier, Ford Motor (NYSE: F ) and Chrysler-parent Stellantis (NYSE: STLA ) said most of their electric and PHEV models would see tax credits halved to $3,750 on April 18. The Treasury confirmed the automakers' calculations.
Shares of GM and RIVN are up 1.09% and 1.98%, while TSLA and STLA are down 0.35% and 1.46% respectively in mid-day trading on Monday.
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