Contact: Noah Barnes, Electrification Coalition
noah@electrification.org, (202) 461-2371
WASHINGTON—Today, the House passed the budget reconciliation bill (218-214), the final step of the legislative process, that kills the federal EV tax credits, dealing a major blow to U.S. manufacturing, economic competitiveness, and national security. As EVs secure a growing share of the global automotive market, it is obvious that the future of transportation is electric; this bill forfeits America’s role in that future to China.
The EV industry and the policies supporting it have driven resurgence of domestic manufacturing, creating hundreds of thousands of jobs in emerging American supply chains for critical minerals used in defense, transportation, information, and energy technologies. Without supportive policies, U.S. suppliers and automakers are unable to compete with Chinese competitors who benefit from market manipulation and lower environmental and workplace standards. This bill further handicaps U.S. business’ ability to compete in the rapidly expanding EV market by:
- terminating the clean vehicle tax credit (30D) by September 30, 2025;
- terminating the used electric vehicle credit (25E) by September 30, 2025;
- terminating the qualified commercial clean vehicle credit by September 30, 2025;
- terminating the alternative fuel vehicle refueling property credit by June 30, 2026;
- rescinding unobligated funding for the Clean Heavy-Duty Vehicle and the Diesel Emissions Reduction Act, among several other critical advanced transportation programs; and
- cutting the penalty for non-compliance of the Corporate Average Fuel Economy (CAFE) standards to $0.
One silver lining: The bill phases out the Advanced Manufacturing Production tax credit (45X) more slowly than other credits. This provides a glimmer of hope for mineral processors and battery manufacturers who may be able to get projects running relatively soon, but projects will still struggle to secure financing.
Electrification Coalition Vice President of Policy Anne Blair issued the following statement:
“By eliminating incentives for EVs, this bill will cause irreparable damage to U.S. manufacturing capabilities, economic competitiveness, and national security.
“We want the future of transportation to be made in America; this bill accomplishes the opposite, jeopardizing hundreds of thousands of well-paying jobs, raising costs for U.S. businesses and consumers, and making U.S. vehicles less competitive on the global market. On the eve of Independence Day, Congress has chosen dependence, cementing our reliance on China for the future of transportation.
“Without a competitive U.S. EV industry, we will remain dependent on volatile oil markets to power our vehicles and reliant on China for the critical minerals used in most advanced technologies. We are incredibly disappointed that Congress has made a choice to entrench these vulnerabilities.”
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About the Electrification Coalition: The Electrification Coalition is a nonpartisan, nonprofit organization that promotes policies and actions to facilitate the widespread adoption of plug-in electric vehicles (EVs) on a mass scale to overcome the economic, public health and national security challenges that stem from America’s dependence on oil. ElectrificationCoalition.org