WionDrive News Desk 
After the US Treasury Department, earlier this month, exempted some trace Chinese minerals in EVs, a Democrat senator seeks to reverse it. Senator Joe Manchin believes the new guidance will increase US reliance on China. The chair of the Senate Energy and Natural Resources Committee said the Treasury’s guidance will make it easier for Chinese companies to take advantage of the EV tax credit “while hurting American taxpayers and increasing America’s reliance on foreign nations for battery and vehicle component supply chains, including China.”
Manchin has asked the US Government Accountability Office for a legal opinion on whether the guidance is subject to the Congressional Review Act. However, it is unclear if the Senate can override the Treasury guidance.
Earlier this month, the US Treasury issued guidance limiting Chinese content in batteries eligible for electric vehicle tax credits. This deemed vehicles from Ford and Tesla ineligible for the federal credits. In a win for automakers, the Treasury ruled it would temporarily exempt some trace critical minerals from new strict rules barring materials from China and other countries deemed a Foreign Entity of Concern (FEOC).
The Alliance for Automotive Innovation, a group representing nearly all major automakers, said the decision to exempt some trace materials for two years “was significant and well-advised” and without it could have deemed nearly all vehicles ineligible for EV tax credits. These few materials being exempted through 2026, however, account for less than 2% of the value of battery critical minerals each.
The new rules will come into effect in 2024 for completed batteries and 2025 for critical minerals used to produce them. These rules are required under an August 2022 law, and are designed to wean the US electric vehicle battery chain away from China.
