Battery sourcing guidance threatens EV tax credits and political pressure mounts.

The US Treasury Department's guidance on battery sourcing requirements for electric vehicle tax credits, due out by Friday, will result in fewer vehicles getting full or partial credits, according to a US official. The guidance will clarify the rules for automakers to qualify for the tax credits, which require 50% of the value of battery components to be produced or assembled in North America and 40% of the value of critical minerals sourced from the US or a country with which it has a free trade agreement. The rules are aimed at weaning the US off dependence on China, which dominates the global supply chains of products like EV batteries and solar panels.