SAVANNAH, Ga. — U.S. Sen. Raphael Warnock on Friday urged the U.S. Treasury Secretary to use “maximum flexibility” in implementing a revised tax credit for Americans who buy electric vehicles, an advantage Hyundai will lose as the automaker Invested billions of dollars to open its first American EV plant in the Democratic Senator’s home state of Georgia.
Warnock sent a letter to Treasury Secretary Janet Yellen raising concerns that the revised tax credit President Joe Biden signed into law last month as part of a sweeping climate and health bill could put some automakers at a competitive disadvantage. That’s because the new law states that the credit of up to $7,500 applies only if the electric vehicles and their batteries are manufactured in North America.
That means vehicles from South Korea-based Hyundai would no longer qualify for the loan until the company begins producing electric vehicles in Georgia, which isn’t expected until 2025.
“I urge you to provide vehicle manufacturers and consumers with maximum flexibility to take full advantage of the EV tax credits available by law,” Warnock’s letter said.
The US Treasury Department is responsible for passing regulations to implement revisions to the Congress-approved electric vehicle tax credit. Warnock’s letter does not request a specific remedy from the department.
In an interview, Warnock said he hopes Treasury Department officials interpret Congressional revisions so that “we don’t end up penalizing the very companies like Hyundai that are helping us create that clean energy future.”
Hyundai announced plans in May to build a $5.5 billion plant in Bryan County, west of Savannah, to manufacture electric vehicles and the batteries that power them. The company plans to hire at least 8,100 people.
Hyundai spokesman Michael Stewart said in an emailed statement the company was “disappointed” with the tax credit revision.
“We hope that a solution can be found by the US federal government that takes into account Hyundai’s significant past and committed future investments in the US market, including its $5.54 billion EV plant in Georgia,” Stewart said .
Stewart didn’t say whether the issue could affect Hyundai’s plans to produce up to 300,000 electric vehicles a year in Georgia. State and local governments agreed to give the automaker $1.8 billion in tax breaks and other financial incentives.
But the issue of the tax credit is causing some concern among Georgia officials who are working closely on the project.
“Hyundai is quite concerned about the lack of the tax credit,” said Trip Tolleson, president and CEO of the Savannah Area Economic Development Authority, who frequently meets with Hyundai officials to discuss the proposed Georgia plant.
“We all really hope that the Biden administration, working with our two US senators, can really fix and resolve the issue,” Tolleson said. “A lot depends on this project.”
Warnock, a newly minted senator, is seeking re-election this fall against Republican challenger Herschel Walker, a Georgia soccer hero and close friend of former President Donald Trump, in a swing state where Democrats have no guarantees they’ll get political Claiming ground they gained in 2020.
Warnock insisted that the climate and health bill that Democrats pushed through Congress is a huge win for Americans and “signals that we’re serious about the role electric vehicles will play in the future.”
“As we see this expansion in South Georgia and the prospects for building electric vehicles that will be manufactured by Georgian workers, we must do what we can at the federal level to strengthen, not hinder, that work,” Warnock said.
