.jpg)
3 hours ago
1
US auto stocks and Asian battery makers fell after Reuters reported President-elect Donald Trump plans to eliminate a key consumer tax credit aimed at boosting electric-vehicle adoption.
Author of the article:
Bloomberg News
Richard Clough
Published Nov 14, 2024 • 2 minute read
(Bloomberg) — US auto stocks and Asian battery makers fell after Reuters reported President-elect Donald Trump plans to eliminate a key consumer tax credit aimed at boosting electric-vehicle adoption.
Trump’s transition team has been discussing ending the $7,500 subsidy as part of a broader tax-reform effort, Reuters said, citing unidentified sources with direct knowledge of the matter. Representatives of Tesla Inc. also support ending the credit, according to the report.
Advertisement 2
THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY
Subscribe now to read the latest news in your city and across Canada.
- Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.
- Daily content from Financial Times, the world's leading global business publication.
- Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.
- National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.
- Daily puzzles, including the New York Times Crossword.
SUBSCRIBE TO UNLOCK MORE ARTICLES
Subscribe now to read the latest news in your city and across Canada.
- Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.
- Daily content from Financial Times, the world's leading global business publication.
- Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.
- National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.
- Daily puzzles, including the New York Times Crossword.
REGISTER / SIGN IN TO UNLOCK MORE ARTICLES
Create an account or sign in to continue with your reading experience.
- Access articles from across Canada with one account.
- Share your thoughts and join the conversation in the comments.
- Enjoy additional articles per month.
- Get email updates from your favourite authors.
THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.
Create an account or sign in to continue with your reading experience.
- Access articles from across Canada with one account
- Share your thoughts and join the conversation in the comments
- Enjoy additional articles per month
- Get email updates from your favourite authors
Sign In or Create an Account
or
Article content
Repealing the subsidy — a major component of President Joe Biden’s signature climate bill, the Inflation Reduction Act — would deal a significant blow to EV adoption in the US, which has already sputtered due to still-high vehicle prices and spotty charging infrastructure. Trump has previously said he would reverse Biden’s EV policies on day one of his presidency.
“The American people re-elected President Trump by a resounding margin giving him a mandate to implement the promises he made on the campaign trail,” said Karoline Leavitt, a spokeswoman for Trump’s transition team. “He will deliver.”
Trump would need Congressional approval to repeal the IRA, which was approved on a party-line vote in August 2022. His transition team has determined some of the policies within the law will be difficult to roll back because certain programs have already started allocating money, including to Republican-dominated states, Reuters said.
Shares of Rivian Automotive Inc. were hardest-hit among major EV makers, plunging 14% in New York trading, the biggest drop since Feb. 22. Tesla also hit an intraday low following the report and closed the day down 5.8%. General Motors Co. and Ford Motor Co. shares declined.
Advertisement 3
Article content
The fallout spread to Asia, with battery maker LG Energy Solution slumping as much as 10% at the open of Seoul trading. LG Energy supplies batteries to automakers including Tesla and GM. SK Innovation Co., the listed parent of battery maker SK On Co., dropped as much as 8%.
“The potential elimination of the federal tax credit for electric vehicles by the Trump administration — without another form of incentive to replace it — could derail the trajectory of EV sales in the United States,” Jessica Caldwell, head of insights for automotive research firm Edmunds.com, said in a note.
While Tesla is by far the top EV seller in the US, Chief Executive Officer Elon Musk has said the company will be better positioned to deal with the potential pullback of incentives. The billionaire has become a member of Trump’s inner circle and accepted a role helping the incoming administration to reduce government spending.
Musk on Thursday posted on his X social-media site that the US should “end all government subsidies, including those for EVs, oil and gas.”
—With assistance from Keith Laing, Hadriana Lowenkron and Kara Carlson.
(Adds shares of South Korean battery makers in 7th paragraph.)
Article content
English (US)