By Michael Elkins
CEOs from General Motors Co (NYSE:GM), Ford Motor Co (NYSE:F), Stellantis NV (NYSE:STLA), and Toyota (NYSE:TM), Monday, sent a joint letter to congressional leaders urging them to lift a cap on the $7,500 electric vehicle tax credit, citing higher costs to produce zero-emission vehicles.
The current $7,500 tax credit phases out after a manufacturer hits 200,000 vehicles sold. Both GM and Tesla (NASDAQ:TSLA) have already hit the cap and are no longer eligible for the consumer tax credits.
"We ask that the per-(automaker) cap be removed, with a sunset date set for a time when the EV market is more mature," the automakers said in the letter.
"Recent economic pressures and supply chain constraints are increasing the cost of manufacturing electrified vehicles which, in turn, puts pressure on the price to consumers."
In April, Senator Joe Manchin, a key Democrat, questioned the need to extend electric vehicle tax credits in the face of strong consumer demand and Chinese production of battery components.
"There's a waiting list for EVs right now with the fuel price at $4. But they still want us to throw $5,000 or $7,000 or $12,000 credit to buy electric vehicles. It makes no sense to me whatsoever," Manchin said. "When we can't produce enough product for the people that want it and we're still going to pay them to take it -- it's absolutely ludicrous in my mind."