WASHINGTON, Aug 12 (Reuters) - Audi of America, Kia Corp
and Porsche said on Friday that buyers of its
electric vehicles will lose access to federal tax credits of up
to $7,500 once President Joe Biden signs a $430 billion climate,
health and tax measure.
The Volkswagen AG unit said only the Audi
plug-in hybrid electric will retain its existing federal credit
through the rest of the year. Audi said the legislation set to
be approved by the U.S. House of Representatives on Friday "will
have consequential impact on our business and to our consumers."
The bill makes any electric vehicles assembled outside North
America ineligible for tax credits, which has brought criticism
from the European Union, South Korea and many automakers.
The bill does allow credits for customers with
binding contracts for vehicles not yet delivered when Biden
signs the legislation.
Kia said in a letter to its U.S. dealers that the bill means
all of its EV and plug-in vehicles will no longer qualify for
tax credits once the bill is signed unless customers have
written binding contracts.
Kia urged dealers to reach out to customers on waiting lists
to enter into contracts before Biden signs the bill. The letter,
which the company confirmed on Friday, called the "sudden
change" in EV tax policy "very disruptive to our business and
unfortunately for our customers."
VW-owned Porsche said on Friday that buyers of its electric
Taycan and plug-in hybrid Cayenne and Panamera vehicles will
also immediately lose eligibility once the legislation is
"With respect to customers who placed vehicles on order and
are still awaiting delivery, their credit eligibility depends on
individual sales agreement, which is a matter between them and
their independently owned and operated Porsche dealership," a
Porsche Cars North America spokesperson said.
The Alliance for Automotive Innovation, a trade group that
represents VW, General Motors Co, Toyota Motor Corp
and Ford Motor Co among others, said last week
the law would make 70% of 72 U.S. electric, plug-in hybrid and
fuel-cell EVs that currently qualify ineligible upon Biden's
signing the law.
On Jan. 1, when the new bill's additional income and price
caps and battery and critical mineral sourcing rules take
effect, "none would qualify for the full credit when additional
sourcing requirements go into effect," the group added.
(Reporting by David Shepardson in Washington
Editing by Jonathan Oatis and Matthew Lewis)