Major automakers are asking the US Congress to remove limits on how many people can get a tax credit for buying a hybrid or fully electric vehicle.
Presently the number of tax credits allowed is limited to 2 lakhs per company. General Motors And Tesla have already reached the cap and Toyota is close to.
In a letter to the leaders of the US Senate and House of Representatives on Monday, the chief executive officer of WadeToyota, GM and stellantis asked that the tax credit be given to anyone wishing to purchase an eligible vehicle.
Automakers want the cap to be lifted until EV The market is more mature,” he said, without giving a time frame.
“Eliminating the cap will encourage consumer adoption of electrified alternatives of the future and provide much-needed certainty to our customers and domestic workers,” the CEO wrote.
The request comes as Americans find themselves financially impacted from all directions by four decades of high inflation. Energy prices have been particularly bad, according to Auto Club AAA, with the average cost of a gallon of gas in the US reaching $5 (about Rs 400) this weekend.
Automakers said on Monday that tax credits have allowed them to offer more affordable cars to the public, helping accelerate the adoption of EVs. However, the companies said that recent economic conditions and supply chain constraints have raised the cost of manufacturing EVs and those costs cause car buyers to already pay more for almost everything.
US President Joe Biden has attempted to ensure the supply of materials needed to produce electric vehicles as the nation moves away from fossil fuels.
In April Biden enacted the 1950 Defense Production Act to boost production of lithium and other minerals important in driving electric vehicles.
Toyota’s plug-in RAV4 Prime small SUV with an electric range of 42 miles gives the buyer a credit of $7,500 (about Rs 5,85,100), the largest available. The Prius Prime plug-in fetches $4,500 (roughly Rs. 3,51,000) with an electric range of 25 miles.
The letter was signed by GM CEO Mary Barra, Toyota CEO Ted Ogawa, Ford CEO Jim Farley and Stelantis CEO Carlos Tavares.