These 20 EVs Will Keep Their Tax Credits for Now

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There are 20 electric vehicles that will qualify for the $7,500 EV tax credit through the end of the year, the US and Mexico are ending a labor investigation at a Mexican Stellantis factory and Warren Buffet doesn’t seem too concerned about it. the car market. All that and more in the morning shift for Wednesday (my guests), August 17, 2022.

1st gear: the 20 qualifications

President Biden signed the sweeping tax, climate and health care bill on Tuesday, and the government now says about 20 models will qualify for the EV tax credit of up to $7,500 through the end of 2022.

That said, the law immediately terminates credits for nearly three-quarters of the 72 previously eligible models. That is because, to be eligible, the EVs must now be assembled in North America.

The number of eligible vehicles is likely to change on January 1, 2023, when new restrictions on battery and mineral resources and price caps come into play. The Alliance for Automotive Innovation, an industrial trade group, says it will not consider all or nearly all EVs. From Automotive News:

The automaker group said it will work with the administration “as they issue critical guidelines and new regulations — so that the EV tax credit is as available and beneficial as possible to consumers.”

Currently eligible vehicles are model year 2022 EV or plug-in hybrid electric versions of the Audi Q5; BMW X5 and 3 Series Plugin; Ford Mach-E, F Series, Escape PHEV and Transit Van; Chrysler Pacifica PHEV, Jeep Grand Cherokee PHEV, and Wrangler PHEV; Lincoln Aviator PHEV and Corsair Plugin; Lucid Air; Nissan Leaf; Volvo S60; and Rivian, R1S and R1T. The 2023 Nissan Leaf, BMW 3 Series and Mercedes EQS are also eligible.

Some models are built both in North America and abroad, and consumers should check vehicle identification numbers to make sure they qualify, the Treasury Department said.

Buyers can still qualify if they had binding written contracts before Biden signed, and some automakers had urged customers to make portions of the down payments non-refundable to qualify.

The law also makes General Motors and Tesla vehicles eligible for taxeedits from January 1st. They had previously lost the credits after reaching the old 200,000 vehicle per manufacturer. However, it’s not clear whether any of the vehicles they make would qualify under the new restrictions.

2nd gear: US and Mexican labor probe ends

The US and Mexican governments have resolved a labor dispute with a Mexican Stellantis factory.

The agreement at Teksid Hierro de Mexico is the fourth employment contract to end under the 2020 United States-Mexico-Canada (USMCA) agreement. It was one of Mexico’s longest-running labor disputes.

U.S. labor officials said workers at the plant, which makes parts for heavy vehicles, including Cummins, Volvo and Mack, were previously denied the right to choose their unions and engage in collective bargaining. From Reuters:

Reuters reported last week that Teksid, which employs some 1,500 people, expected to close the case without going to a dispute resolution committee after the company recognized an independent union, a move workers blamed on US pressure under the USMCA.

Workers had fought since 2014 to form a union known as The Miners at the Teksid factory in the northern state of Coahuila, accusing the company of collaborating with a powerful rival union to block their efforts.

The USMCA resolution “will help end eight years of human rights abuses against Teksid workers,” U.S. Secretary of Labor Marty Walsh said in a statement.

As part of the deal, the unit of Italian-French automaker Stellantis agreed in July to re-hire 36 workers on back pay, who said they had been laid off in retaliation for supporting the union, which also metal workers and miners.

Stellantis says it is “working diligently” with government officials during the process. The company says it respects collective bargaining rights and complies with local laws.

3rd gear: Buffett is not worried

Warren Buffett doesn’t seem to think that the good times for car dealers are not over. New filings show that Berkshire Hathaway has tripled its stake in Ally Financial, a longtime automotive financial company, to $1 billion in the second quarter of 2022.

The world’s most famous investor seems to believe that credit margins will remain strong and the default rate will remain low. From Financial times:

In the two pandemic years, Ally’s stock rose 57 percent. The stock was bolstered by consumers flocking with cash flowing in to buy used vehicles. Car manufacturers could not meet the demand for new cars.

Ally shares are down a quarter so far in 2022. Wall Street is concerned about US consumer finances and a normalization of the auto market. Ally says those concerns remain exaggerated, a view now implicitly supported by a legendary investor.

Between the end of 2019 and the beginning of 2022, the Manheim Used Vehicle Value Index rose by a staggering 70 percent. Higher used car prices supported larger loans at a time when there were virtually no concerns about immediate credit losses.

Net interest income rose significantly in the current quarter compared to 2021. However, Ally had to build up loan loss provisions so large that pre-tax income fell 40 percent year-on-year. The company insists those provisions are simply a natural return to normalcy.

The move is a vote of confidence not just in car loans, but in the purchasing power of consumers as a whole. If Warren isn’t concerned about our ability to spend money with confidence, why should we be?

4th gear: BMW’s battery switch up

Chinese EVE Energy CO Ltd will supply BMW with large cylindrical batteries for the company’s electric cars in Europe. BMW is reportedly following in Tesla’s footsteps by adopting the new technology. Vehicles with the new batteries will be on the market in 2025.

Earlier this year, Tesla began production of its new large-format 4680 cylindrical battery. 4680 means 46 millimeters in diameter and 80 millimeters in length. Tesla says it expects the new battery to lower manufacturing costs and improve range compared to the current generation of 2,170 cylindrical batteries.

EVE’s batteries are expected to be the same size as Tesla’s. From Reuters:

EVE, a supplier to BMW in China, did not directly respond to questions from Reuters when asked for comment. BMW said it plans to release some battery-related news in early September, but declined to comment further.

The shift by BMW, which currently uses prismatic batteries, underlines the growing momentum for larger-sized cylindrical batteries. Prismatic batteries, which are rectangular in shape, have become the most common form of automotive batteries in the past two years because they can be packed more closely together, which saves costs. But proponents of cylindrical batteries argue that the newer, larger-sized cells have become more cost-effective due to improvements in energy density.

China’s CATL (300750.SZ), the world’s largest battery manufacturer, will also start supplying cylindrical batteries to BMW from 2025.

Expectations are high that these batteries will also be large format cells. CATL did not respond to a request for comment on planned dimensions.

At this point, it’s not clear exactly how many batteries BMW plans to get from EVE and CATL.

5th gear: No power

Toyota has suspended operations at one of its factories in China after local authorities issued an order to save electricity. The factory will be closed until Saturday, a company spokesman said.

Sichuan province, where the plant is located, is rationing industrial electricity consumption during its worst heat wave in 60 years. It has prompted producers of fertilizers, lithium and other metals to suspend factory operations or curb production. From Reuters:

Industrial users in 19 of the province’s 21 cities were ordered to suspend production from Aug. 15 to 20 to prioritize power supply to homes, according to a message released Sunday by the Ministry of Economy and Information Technology of the United States. Sichuan.

“We are monitoring the situation every day and following government guidelines,” said the Toyota spokesperson.

Toyota would not say how much vehicle power would be affected by the suspension.

Reverse: Up!

This is transport content if I’ve ever seen it.

The Valley Voice
The Valley Voicehttp://thevalleyvoice.org
Christopher Brito is a social media producer and trending writer for The Valley Voice, with a focus on sports and stories related to race and culture.

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