EXCLUSIVE CEOs of US automakers Toyota urge Congress to lift electric vehicle tax credit cap

WASHINGTON, June 13 (Reuters) – General Motors Co (GM.N), Ford Motor Co (FN), Stellantis NV (STLA.MI), parent company of Chrysler, and Toyota Motor North America (7203.T) on Monday urged Congress to lift a cap on the $7,500 tax credit for electric vehicles, citing higher costs to produce zero-emission vehicles, according to a letter seen by Reuters.

The CEOs – GM’s Mary Barra, Ford’s Jim Farley, Stellantis’ Carlos Tavares and Toyota North America CEO Tetsuo Ogawa – said in the joint letter to congressional leaders that they pledged to invest more than $170 billion dollars until 2030 to support the development of electric vehicles. , production and sale.

The current $7,500 tax credit is phased out after a manufacturer reaches 200,000 vehicles sold. GM and Tesla (TSLA.O) have already hit the cap and are no longer eligible for consumer tax credits.

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“We are asking that the per (automaker) cap be removed, with a sunset date set at a time when the electric vehicle market is more mature,” the automakers said in the letter.

“Recent economic pressures and supply chain constraints are increasing the cost of manufacturing electrified vehicles, which, in turn, is putting price pressure on consumers.”

The letter comes amid growing concern among auto industry executives that the window may be closing for the U.S. Congress to extend electric vehicle tax credits, given that Republicans could regain control of one or both houses of Congress next year.

Last week, Ford executive chairman Bill Ford dropped by on Capitol Hill unannounced to make the case for the tax credit extension.

In April, Sen. Joe Manchin, a key Democrat, questioned the need to expand tax credits for electric vehicles in the face of strong consumer demand and Chinese production of battery components.

“There is a waiting list for electric vehicles right now with the price of fuel at $4. But they still want us to issue a credit of $5,000, $7,000 or $12,000 to buy vehicles It doesn’t make sense to me,” Manchin said. “When we can’t produce enough product for the people who want it and we’re still going to pay them to take it, that’s absolutely ridiculous in my mind.”

Last year, many Democrats in Congress and President Joe Biden proposed increasing tax credits for electric vehicles up to $12,500, including a $4,500 incentive for state-assembled vehicles. United and made by unions.

Manchin has previously opposed the union-only incentive, as has Toyota.

The new letter makes no reference to union incitement.

Biden also backed a 30% credit for commercial electric vehicles and a $4,000 tax credit for used electric vehicles and made the current credit refundable at the point of sale.

He also called for the phasing out of credits for electric vehicles made outside the United States, prompting furious opposition from Canada and other car-producing nations.

Toyota said in April it expected its credits to expire by the end of 2022 after hitting the cap. Ford has sold nearly 160,000 electric vehicles through the end of 2021 and could hit the cap this year.

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Reporting by David Shepardson; editing by Deepa Babington

Our standards: The Thomson Reuters Trust Principles.

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