These 20 EVs Will Keep Their Tax Credits for Now

These electric vehicles will qualify for the $7,500 tax credit through the end of 2022.

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There are 20 electric vehicles that will qualify for the $7,500 EV tax credit through the end of the year, the U.S. and Mexico are ending a labor probe at a Mexican Stellantis plant, and Warren Buffet doesn’t seem to0 worried about the car market. All that and more in The Morning Shift for Wednesday (my dudes), August 17, 2022.

1st Gear: The 20 Qualifiers

President Biden signed the sweeping tax, climate and health care bill on Tuesday, and the administration now says about 20 models will still qualify for the up to $7,500 EV tax credit through the end of 2022.


That being said, the law immediately ends credits for almost three quarters of the 72 models that were previously eligible. That’s because, in order to qualify, the EVs must now be assembled in North America.

The number of eligible vehicles is likely to change come January 1, 2023, when new restrictions on battery and mineral sources and pricing caps come into play. The Alliance for Automotive Innovation, an industry trade group, says it’ll make all or nearly all EVs ineligible. From Automotive News:

The automaker group said it will work with the administration “as they issue critical guidance and new regulations – so the EV tax credit is as available and beneficial to consumers as possible.”

Currently eligible vehicles are 2022 model year EV or plug-in hybrid electric versions of the Audi Q5; BMW X5 and 3-Series Plug-in; Ford Mach-E, F-Series, Escape PHEV and Transit Van; Chrysler Pacifica PHEV, Jeep Grand Cherokee PHEV and Wrangler PHEV; Lincoln Aviator PHEV and Corsair Plug-in; Lucid Air; Nissan Leaf; Volvo S60; and Rivian, R1S and R1T. The 2023 Nissan Leaf, BMW 3-Series and Mercedes EQS are also eligible.

Some models are built both in North America and overseas and consumers should check vehicle identification numbers to ensure eligibility, the Treasury Department said.


Buyers can still qualify if they had binding written contracts before Biden’s signing and some automakers had been urging customers to make portions of deposits non-refundable to qualify.


The law also makes General Motors and Tesla vehicles eligible for tax credits starting on January 1. They had previously lost the credits after hitting the old 200,000-vehicle per manufacturer cap. However, it’s not clear if any of the vehicles they make would qualify under the new restrictions.

2nd Gear: U.S. and Mexican Labor Probe Ends

The U.S. and Mexican governments have resolved a labor dispute with a Mexican Stellantis manufacturing plant.


The agreement at Teksid Hierro de Mexico is the fourth labor probe to end under the 2020 United States-Mexico-Canada Agreement (USMCA). It was one of Mexico’s longest-running labor conflicts.

U.S. labor officials said workers at the plant, which makes parts for heavy vheicles including Cummins, Volvo and Mack, were previously denied their rights to choose their union and do collective bargaining. From Reuters:

Reuters reported last week that Teksid, which employs some 1,500 people, expected to close the case without going to a dispute panel after the company recognized an independent union, a move workers attributed to U.S. pressure under the USMCA.

Workers since 2014 had fought to establish a union known as The Miners at the Teksid plant in the northern state of Coahuila, and accused the company of colluding with a powerful rival union to block their efforts.


The USMCA resolution “will help end eight years of rights violations against Teksid workers,” U.S. Labor Secretary Marty Walsh said in a statement.

As part of the agreement, the unit of Italian-French carmaker Stellantis in July agreed to re-hire, with back pay, 36 workers who said they had been fired in retaliation for supporting the union, which also represents metalworkers and miners.


Stellantis says it is “diligently cooperating” with governmental officials during the process. The company says it respects collective bargaining rights and will comply with local laws.

3rd Gear: Buffett Ain’t Worried

Warren Buffett doesn’t seem to think the good times are over for car dealers just yet. New filings show Berkshire Hathaway tripled its stake an Ally Financial, a long-time automotive financial company, to $1 billion in the second quarter of 2022.


The world’s most famous investor seems to believe lending margins will remain strong and default rates will stay low. From Financial Times:

In the two pandemic years, shares in Ally rallied 57 per cent. The stock was buoyed by consumers flush with cash flocking to buy used vehicles. Auto manufacturers were unable to meet demand for new cars.

Ally shares, have fallen by a quarter so far in 2022. Wall Street is worried about the finances of the US consumer as well as a normalisation in the auto market. Ally says those worries remain overstated, a view that now has the implicit endorsement of a legendary investor.

Between the end of the 2019 and the start of 2022, the Manheim Used Vehicle Value Index increased by a vertiginous 70 per cent. Higher used car prices supported bigger loans at a time when there were virtually no concerns about immediate credit losses.

Net interest revenue increased substantially in the current quarter, compared with 2021. However, Ally was forced to accrue credit loss provisions so big that pre-tax income fell 40 per cent year on year. The company insists those provisions are simply a natural reversion to ordinary levels.


The move is a vote of confidence not only in auto loans, but in consumer spending power as a whole. If Warren’s not worried about our ability to confidently spend money, why should we be?

4th Gear: BMW’s Battery Switch Up

China’s EVE Energy CO Ltd is going to start supplying BMW with large cylindrical batteries for the company’s electric cars in Europe. It’s reported BMW is following in Tesla’s footsteps by adopting the new technology. Vehicles with the new batteries are due to hit the market in 2025.


Earlier this year, Tesla starting manufacturing its new large-format 4680 cylindrical battery. 4680 means 46 millimeters in diameter and 80 millimeters in length. Tesla says it expects the new battery to lower production costs and improve range compared to the current-generation 2170 cylindrical batteries.

EVE’s batteries are expected to be a similar size to Teslas. From Reuters:

EVE, a supplier to BMW in China, did not directly address Reuters queries when asked for comment. BMW said it plans to release some battery-related news in early September but declined further comment.

The shift by BMW, which currently uses prismatic batteries, underscores growing momentum for larger-format cylindrical batteries. Prismatic batteries, which are rectangular in shape, have become the most common form of auto battery in the past two years as they can be more densely packed, saving on costs. But proponents of cylindrical batteries argue the newer larger format cells have become more cost-effective due to improvements in energy density.

China’s CATL (300750.SZ), the world’s largest battery maker, is also due to start supplying cylindrical batteries to BMW from 2025.

Expectations are high that these batteries will also be large-sized cells. CATL did not respond to a request for comment on planned dimensions.


Right now, it’s not clear exactly how many batteries BMW plans to get from EVE and CATL.

5th Gear: Out Of Power

Toyota has suspended operations at one of its plants in China after local authorities issued an order to conserve electricity. The manufacturing facility will be shuttered until Saturday, according to a spokesperson for the company.


Sichuan province, where the plant is located, is rationing industrial electricity consumption during its worst heatwave in 60 years. It’s caused producers of fertilizers, lithium and other metals to suspend plant operations or curb output. From Reuters:

Industrial users across 19 out of 21 cities in the province were ordered to suspend production from Aug. 15 until Aug. 20 to prioritise residential power supply, according to a notice issued on Sunday by the Department of Economy and Information Technology of Sichuan.


“We’re monitoring the situation every day and following the guidance from the government,” the Toyota spokesperson said.


Toyota wouldn’t say just how much vehicle output would be impacted by the suspension.

Reverse: Up!

This is transportation content if I’ve ever seen it.


Neutral: I’m A Gossip Girl Now

I just signed the lease on an apartment on the Upper East Side of Manhattan. Call me Blair Waldorf, because I’m very fancy. Unfortunately, this will continue my issue of not being able to have my car in the same state I live in. You win some, you lose some. What can ya do, ya know? It’s going to be a fun time. Buh bye, Lower Manhattan.