The United States House of Representatives advanced legislation this Thursday that would tighten rules for deciding which electric vehicles are eligible for $7,500 federal EV Tax Credits upon purchase. The bill’s debate was heated, passing 217 to 189 on a mostly party-line vote. It pitted members of the Michigan delegation against one another, as they disagreed strongly over what the law would and would not do.

“The American people do not want to be held hostage to the whims of the Chinese Communist Party for our supply of critical minerals,” said US Rep. John Moolenaar (R-Michigan). “Under the current regulations, brought about by the Inflation Reduction Act, these nightmares have become our reality.”

U.S. Representative Dan Kildee (D-Michigan) argued the opposite. “Ironically, this bill would make it harder for us to compete with China,” the governor stated.

Kildee kept going: “These new, unclear restrictions, according to this bill, would make it completely impractical and lead the auto industry and battery makers to cut back their U.S. investments, to withdraw from investing in manufacturing for those essential components right here in the United States and from welcoming countries, and instead go back to relying on China.”

The debate was the latest example of politicians using EVs and China as political footballs. Both sides agreed that they wanted to promote US automotive sector interests but disagreed fiercely on how to do so.

Carol Miller, a Republican United States Representative from West Virginia, presented the End Chinese Dominance of Electric Vehicles in America Act in April. It wants to prohibit EVs built using components or materials from any business with ties to China, particularly those with at least 25% ownership by a Chinese entity or individual, from obtaining federal tax credits.

The restrictions on Chinese ties would apply to licensing agreements, such as the one Ford Motor Co. has with Chinese battery manufacturer Contemporary Amperex Technology Co. Ltd., or CATL, for a facility in Marshall, Michigan. They would also apply to Chinese corporations’ American subsidiaries, such as the under-development Gotion Inc. battery production facility near Big Rapids, Michigan.

Tax credit regulations already restrict sourcing and partnerships with Chinese enterprises but are less harsh. They also do not fully apply to essential minerals until 2025.

Moolenaar, whose district includes Big Rapids, Michigan, chairs the House Select Committee on the Chinese Communist Party and has been an outspoken critic of the Gotion site.

“We want to promote American energy innovation. We cannot provide subsidies to CCP enterprises at the same time.” “Funding CCP-aligned companies weakens the United States and strengthens the CCP, and we need to end it,” he stated during the floor debate, adding that the bill was consistent with his proposed NO GOTION Act.

China is presently the world leader in the making of electric vehicle components like batteries and in the harvesting of essential minerals needed to make them.

Democratic President Joe Biden and his allies tried to counter China’s dominance with an Inflation Reduction Act package that included increased EV tax credits and new production incentives, environmental regulations that accelerated the national transition to EVs, and tariffs on Chinese EVs.

Currently, 11 automobiles for model year 2024 are eligible for the full $7,500 tax credit, and several more are eligible for half of the EV Tax Credits.

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