(CNN) The Treasury Department has announced which cars are eligible for the new electric vehicle tax credits. Fewer models are eligible for the new subsidy than in previous years, but some of the best-known EVs still qualify, according to Monday’s announcement.
Under the new rule, consumers can reclaim up to $7,500 in tax credits for eligible cars.
Sixteen new models and some of their variations are eligible for all or half of the new loan, while nine models – mostly foreign-made vehicles – are no longer eligible for the time being.
Most registered cars so far are made by the “big three” EV automakers in the US – Ford (F), General Motors and Stellantis – and Tesla (TSLA).
Here’s what you need to know.
Which models are eligible for the new EV tax credit?
2022-2023 Chrysler Pacifica PHEV
2022-2023 Jeep Wrangler PHEV 4xe
2022-2023 Jeep Grand Cherokee PHEV 4xe
2022-2023 Ford F-150 Lightning (Standard and Extended Range)
2022 Ford e Transit
2022-2023 Ford Mustang Mach-E (Standard and Extended Range)
2022 Ford Escape plug-in hybrid
2022 Lincoln Corsair Grand Touring
2023 Lincoln Aviator Grand Touring
2022-2023 Chevrolet Bolts
2022-2023 Chevrolet Bolt EUV
2023-2024 Cadillac LYRIQ
2024 Chevrolet Silverado EV
2024 Chevrolet Blazer EV
2024 Chevrolet Equinox EV
2022-2023 Tesla Model 3 Standard Range RWD
2022-2023 Tesla Model 3 performance
2022-2023 Tesla Model Y AWD
2022-2023 Tesla Model Y Long Range AWD
2022 Tesla Model Y performance
Which electric vehicles do not qualify for the new tax credit?
Nine models, mainly from foreign brands including Hyundai and Nissan, do not qualify for the new tax credit. However, that could change in the coming months and years – and will likely change as some of these brands build factories in the US to assemble their vehicles.
What about used and leased electric vehicles?
A separate tax credit applies to used EVs, which does not impose as stringent requirements on battery content or manufacturing. Used electric vehicles are eligible for a reduced total tax credit and also come with certain income requirements.
Similarly, leased vehicles can also qualify for a $7,500 tax credit without some of the strict rules surrounding the batteries and final assembly of the car, meaning consumers who want a wider choice of models may opt to lease could decide instead of buying directly.
Where can I see updates to the Eligible EV List?
The list of eligible new and used electric vehicles will be updated at www.fueleconomy.gov.
How much money will I get back for buying an electric vehicle?
Under the new rule, consumers can get up to $7,500 in tax credits for eligible cars. There is no limit to the number of electric vehicles automakers can sell with tax credits, as long as those vehicles meet the requirements. This is a change from the previous rule that limited the number of vehicles that could be sold with the tax incentives.
Will more EVs be added to the tax credit list?
Some cars previously eligible for tax credits have been removed under the new rule. However, administration officials told CNN that more cars are being added to the list as automakers scramble to move their factories and supply chains to the U.S. and other countries with these free trade deals, though it could take months or even years.
Why are fewer electric vehicles now eligible for tax credits?
The new Treasury rule on electric vehicles stems from the Inflation Reduction Act, the climate and clean energy law passed by Congress last year. The rules were written to help move the supply chain away from China for the critical minerals needed for things like EV batteries, solar panels and smaller rechargeable batteries.
There are two main requirements that automakers must meet if they want their electric vehicles to be eligible for the $7,500 tax credit: a critical minerals requirement and a battery component requirement, each worth $3,750.
The critical minerals requirement mandates that a certain percentage by value of the critical minerals that power electric vehicle batteries — such as lithium, nickel, graphite and copper — be extracted or processed in the United States or a country that has a free trade agreement must with. The minerals could also have been recycled in North America. The battery component requirement dictates that a certain percentage of the value of the battery components must be manufactured or assembled in North America.
Importantly, these requirements will increase over several years. For critical minerals, the percentage will start at 40% in 2023 and increase to 80% each year through 2027. For battery components, the percentage will start at 50% and increase to 90% every year until 2028.
Administrators and experts agree that implementing the rules in a very short timeframe is incredibly complicated.
“They’re just quite complex,” senior White House adviser John Podesta recently told CNN.
Which countries can the materials come from under the new EV tax credit scheme?
21 countries will have FTAs on critical minerals with the US: Australia, Bahrain, Canada, Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Israel, Jordan, Korea, Mexico, Morocco, Nicaragua, Oman, Panama , Peru, Singapore and Japan.
Countries like Chile and Australia are notable as both have vast lithium supply and extensive mining operations. Senior government officials said the new rule will make those countries’ lithium more competitive: instead of going to China, the minerals could go to Japan or Korea, or straight to the United States. Korea, Mexico, and Japan have large auto assembly plants, and many of these cars end up being sold in the United States.
Biden said the US is also negotiating to add the European Union to the list and more may be added in the future.
How long might it take to build a critical mineral supply chain in eligible countries?
In recent months there has been a spate of announcements from automakers that are moving their electric vehicle and battery manufacturing facilities to the US and neighboring countries.
But experts and officials say the start of the critical minerals supply chain – the mining and refining of critical minerals – will be the most difficult aspect to change. That’s in large part because China has it firmly in its grip. The US has few lithium mines in Nevada. Companies are vying to begin mining lithium around California’s Salton Sea, although commercial activity has not yet begun.
The Department of Energy “can provide a loan to build a battery manufacturing facility,” Boylan said. “It’s a very different ball game than talking about permitting an open pit lithium mine.”