The U.S. and Japan announced a trade deal on electric vehicle battery minerals that would grant Japanese automakers access to the Biden administration’s $7,500 EV tax credit scheme as part of the Inflation Reduction Act.
The announcement added that the two countries share a common interested in raising “resilience against threats such as economic coercion and non-market policies.”
The IRA states plug-in electric vehicles much be produced in North America to qualify for the tax incentives.
“This is a welcome moment as the United States continues to work with our allies and partners to strengthen supply chains for critical minerals, including through the Inflation Reduction Act,” U.S. Trade Representative Katherine Tai said in a statement.
She added that the announcement is “proof” of the U.S. government’s “commitment to building resilient and secure supply chains.”
South Korean officials have also been engaging in discussions to adjust regulations to work around the eliminated tax credits for EVs made outside of North America.
This article was originally published by CNBC.