Your #1 source for auto industry news and content


Secretary Yellen says foreign car brands may be able to qualify for EV tax credits

The Treasury Secretary noted that international free trade agreements could grant access to tax credits without congressional approval

U.S. Treasury Secretary Yellen said that free trade agreements may give overseas automakers a way to earn electric vehicle tax credits without an act of congress.

Speaking to reporters at the G20 Finance Ministers Meeting last Friday, Secretary Yellen noted that the Biden Administration’s Inflation Reduction Act included legislation which would allow countries to negotiate free trade agreements with the U.S. on behalf of their automakers, whose vehicles are otherwise barred from EV incentives. Such arrangements would allow the federal government to use the tax credits as leverage, with the primary goal of securing expensive battery minerals for domestic purposes.

This method, which Secretary Yellen has already sought to use, could help soothe international tensions. Automakers and politicians, predominantly in Asia and the European Union, have criticized the legislation for its restrictive eligibility standards. For an EV to qualify for tax credits, the bill requires a majority of both its components and materials to be built and sourced domestically. Although they were mainly intended to reduce the industry’s reliance on Chinese mining and manufacturing, these rules also prevented vehicles from global brands such as Hyundai, Volkswagen and Toyota. Since the legislation passed, several global car brands have announced plans to build new factories in the U.S., causing employment concerns in their home countries.

Advertising Partner Advertisement

The Treasury Secretary noted that, as free trade agreements are already covered in the Inflation Reduction Act, the President would be able to negotiate these agreements without changing the law, thus circumventing the normal requirement for congressional approval. Currently, new EVs, which meet all of the act’s manufacturing and pricing guidance, can qualify for up to $7,500 in tax credits.

Did you enjoy this article? Please share your thoughts, comments, or questions regarding this topic by connecting with us at

Be sure to follow us on Facebook, LinkedIn, and TikTok to stay up to date.

While you’re here, don’t forget to subscribe to our email newsletter for all the latest auto industry news from CBT News.

Colin Velez
Colin Velez
Colin Velez is a staff writer/reporter for CBT News. After obtaining his bachelor’s in Communication from Kennesaw State University in 2018, he kicked off his writing career by developing marketing and public relations material for various industries, including travel and fashion. Throughout the next four years, he developed a love for working with journalists and other content creators, and his passion eventually led him to his current position. Today, Colin writes news content and coordinates stories with auto-industry insiders and entrepreneurs throughout the U.S.

Related Articles


Latest Articles

From our Publishing Partners