The U.S. Treasury Department and Internal Revenue Service have updated the EV tax credit with new requirements that should allow more EVs to qualify.
When the Clean Vehicle Tax Credit was launched in 2023, it was structured in a way that would introduce new changes with each calendar year, one of the provisions being ever-stricter rules around what percentage of battery materials are sourced from the U.S. or its trade partners. Automakers have struggled with this shift, and so the credit has been relaxed until 2027, specifically around the sourcing of materials such as graphite, electrolyte salts, binders, and other additives.
This update should make it easier for vehicles to qualify, including some of those that may have lost the credit over the past couple of years. With that said, it’s a new model year now and it will take some time to know which vehicles will benefit from this change. We’ll have to rely on automakers to tell us, as only they know the sourcing of their battery materials.
We suspect some announcements in the coming days around vehicles that have gained access to the credit, and we’ll keep you posted as news breaks.
