GM - Meet the only electric vehicles that will qualify for the full U.S. tax credit

2023-04-17 14:12:27 ET

Treasury Department rules will take effect on April 18 that will reduce the number of electric vehicles that qualify for the full federal EV tax credit. The new rules stipulate that electric and plug-in-hybrid vehicles can only get the full tax credit if the vehicles are made in the United States and most of their batteries and critical minerals are sourced domestically or from the closest trading partners.

Models that will qualify for the full $7,500 tax credit include variants of the Cadillac ( GM ) Lyriq, Chevrolet Blazer, Chevrolet Bolt, Chevy Silverado EV, Ford ( F ) F-150 Lightning, Tesla ( NASDAQ: TSLA ) Model 3 (performance), Tesla Model Y, Chrysler ( STLA ) Pacifico plug-in hybrid, Lincon Aviator Grand Touring. Models that will qualify for a $3,750 tax credit include the Ford E-Transit, Ford Mustang Mach-E, Tesla Model 3 (standard range rear-wheel drive), Ford Escape plug-in hybrid, Jeep Grand Cherokee PHEV, Jeep Wrangler PHEV, and Lincoln Corsair Grand Touring.

The list of automakers that will lose access to the $7,500 electric vehicle tax credit under the new Treasury Department sourcing rules includes Volkswagen ( OTCPK:VLKAF ), BMW ( OTCPK:BMWYY ), Nissan ( OTCPK:NSANY ), Rivian Automotive ( RIVN ), Hyundai ( OTCPK:HYMLF ) and Volvo ( OTCPK:VLVOF ).

While the EV sourcing rules are set to tighten in 2025 with battery minerals not allowed from a foreign entity of concern such as China and Russia, some analysts expect carveouts and adjustments to be made on pricing and sourcing rules that could potentially help EV startups such as Rivian ( RIVN ), Fisker ( FSR ) and Lucid Group ( LCID ).

Sector watch: Investors strap in for Tesla earnings this week.

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