In the two weeks since the Inflation Reduction Act (IRA)—the biggest climate bill in the US history—was signed into law, foreign companies have announced a flurry of blockbuster investments in battery plants in the US.
These investments are likely spurred by the promise of attractive tax credits offered under the IRA for electric vehicle manufacturers that meet sourcing requirements. To be eligible for these credits, at least 40% of critical minerals used in EV batteries must be sourced from the US or a free trade partner by 2024. That threshold will ramp up to 80% by 2027.
Toyota, Honda, and LG want to make batteries in the US