Senators Schumer and Manchin -- incentives for electric vehicles has put the spotlight on the domestic supply chain for electric vehicles
News of the deal between Senators Schumer and Manchin to extend and revise the incentives for electric vehicles has put the spotlight on the domestic supply chain for electric vehicles. Their proposal not only extends EV incentives, it does so in a way that requires manufacturers to source a rapidly increasing share of battery materials and components domestically or from U.S. trade allies.
But as details of the sourcing requirements come out, concerns are already being raised about whether the requirements could short-circuit the value of the revised electric vehicle incentives. Once enacted, 40% of the value of the critical materials and 50% of components in the battery must meet the sourcing requirements to claim the full $7500 tax incentive — and those percentages go up each year starting in 2024.
Does this flurry of activity add up to a domestic electric vehicle supply chain? To what extent are these new projects just plans? How many projects are under construction? Which facilities are in production? Where are they located? How many jobs could be created? To help answer these questions, we built an interactive map-based dashboard to track the status of the USA’s electric vehicle supply chain.
The chief lesson that emerges from the dashboard will not come as a surprise: Few sites in the United States are mining or refining the critical materials needed for batteries . Although a dozen more sites are in the planning stages, given the challenges in permitting mining and refining operations and bringing them into production, manufacturers face significant challenges in meeting the requirements for sourcing materials domestically to meet the requirements of the proposed EV incentives.
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