Not every automaker is supportive of the current tax credits proposed for electric vehicles. Toyota sent a letter to several lawmakers claiming part of the credits favoring union-made EVs and batteries penalizes a slew of American workers, specially Toyota’s hourly employees.
The Japanese automaker sent letters “on behalf of more than 180,000 Americans who support their families by working at Toyota.” The company contends the proposed $4,500 federal tax credit for electric vehicles produced at plans with union employees is unfair.
Sent to members of the U.S. House Ways & Means Committee, the letter outlines Toyota’s U.S. workforce is being unfairly penalized despite working just as hard to provide U.S. consumers zero-emissions vehicles — and to meet the goal of half of its new vehicles being electrified by 2030.
Toyota’s U.S. plants are not unionized. The letter is signed by Leah Curry, president of Toyota Manufacturing Indiana.
“Toyota has put more vehicles with electrified powertrains on U.S. roads than any other automaker,” the company notes in the letter. The Toyota Prius was the first mass market electric hybrid in the U.S. It’s the best-selling hybrid in the U.S. as well as the rest of the world.
Not alone in its dissent
Honda joined Toyota in voicing is opposition to the credit, largely on similar grounds, claiming in a statement published by Reuters, it “discriminates among EVs made by hard-working American auto workers based simply on whether they belong to a union. … The Honda production associates in Alabama, Indiana and Ohio who will build our EVs deserve fair and equal treatment by Congress.”
The $3.5 trillion bill is supposed to be voted on Tuesday. The House Ways & Means Committee, led by Democrats, is expected to pass, leading to a vote before the full U.S. House. Michigan-based Democrats in the House and Senate, Rep. Dan Kildee (D-Flint) and Sen. Debbie Stabenow (D-Michigan), are helping to lead the charge for the union-made provision.
Under the Kildee/Stabenow “Made in America Provision,” there would be a $7,500 consumer credit for EVs. But those assembled in the U.S. with unionized labor also would be eligible for a $4,500 bonus and an additional $500 bonus for batteries built in the United States with union labor.
With the bonuses, union-made EVs would qualify for $12,500 in rebates applied at point of sale or on tax returns, depending on the consumer’s preference, according to the bill’s authors.
In addition, after the first five years the consumer subsidies continue for vehicles assembled in the U.S. and rebates would continue to apply. However, vehicles made in South Korea, Japan, China or Europe would no longer be eligible for the subsidies after five years.