Manchin vows to reverse Biden rules on Chinese supply chains for EVs
Breanne Deppisch
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Sen. Joe Manchin (D-WV) blasted the Biden administration’s new rules aimed at curbing China’s influence in the electric vehicle market on Friday, vowing to pursue “every avenue and opportunity” to reverse the new guidance.
His scathing repudiation comes just hours after the Biden administration published its new proposed guidance, aimed at shoring up domestic manufacturing for electric vehicles and moving the EV supply chain for away from China.
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Manchin has for months urged the Treasury to publish strict guidance on which EVs qualify for the Inflation Reduction Act’s consumer tax credits under section 30D of the law.
But the outgoing West Virginia Democrat blasted the guidance on Friday, describing it as an attempt from the Biden administration to find “workarounds and delays that leave the door wide open for China to benefit off the backs of American taxpayers.”
“I will take every avenue and opportunity to reverse this unlawful, shameful proposed rule and protect our energy security,” Manchin said. “That includes pushing the Treasury Department to make revisions, pursuing a Congressional Review Act resolution, and supporting any lawsuit against the rule.”
There are three main components of the new guidance relating to “foreign entities of concern.” The guidance for the manufacturing of batteries will go into effect in 2024. The guidance for the sourcing of critical minerals used in batteries will go into effect in 2025.
The first is a restriction related to an entity that is either incorporated in, headquartered in, or performing the relevant activities in a “covered nation,” which includes China, Russia, North Korea, and Iran.
The second applies to any entity that has at least 25% voting interests, board seats, or equity interests held either directly or indirectly by the government of a covered nation, regardless of where the activities occur.
The third provision applies to companies operating outside a covered nation under a contract or licensing arrangements from a covered nation and that fail to obtain certain rights for their vehicles to qualify for the 30D requirement.
It is unclear how many EVs will qualify for the full IRA tax credits under the new rules, though Alliance for Automotive Innovation President and CEO John Bozzella said Friday that he estimates just 20 models out of the more than 103 EV models currently on sale in the United States would be eligible if the guidance came into force today.
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Bozzella said the EV transition “requires nothing short of a complete transformation of the U.S. industrial base. It’s a monumental task that won’t happen overnight.”
Manchin had brokered a deal with Senate Majority Leader Charles Schumer (D-NY) to pass the Inflation Reduction Act last year. Following its passage, he has blasted the administration as interpreting its provisions to favor the quick adoption of green technologies rather than promoting energy security and domestic production as he had intended.