EV Tax Credit Changes Have Shuffled EV Sales Rankings

Chris Teague
by Chris Teague

Changes in the EV tax credit rules have been confusing and made it hard to determine which cars are eligible for credits. Some automakers argued that the rules would unfairly harm their business and ability to compete, and we’re now starting to see how some of the changes are shaking out. Automotive News reported that the top eight EVs in the U.S. in January were built in North America, while Hyundai and Kia fell back.

The rule changes have so far benefitted Tesla, Ford, and Volkswagen since the German automaker moved some ID.4 production to its Chattanooga factory in 2022. At the same time, the Hyundai Ioniq 5, which was previously selling in the number-seven spot, dropped to ninth, and the Kia EV6 was knocked out of the top ten altogether from its previous spot in eighth.

Many automakers are scrambling to get a production foothold in the U.S. after the Inflation Reduction Act updated EV tax credit rules to include a final assembly location in North America. Audi, Mercedes-Benz, and others have moved or plan to move some manufacturing here to qualify for credits. 

Hyundai and Kia will eventually get things together, but another part of this story is the growth that EVs have seen in the U.S. market. Though still in single-digit percentages, new EV registrations have grown 74 percent from 2022 to 7.1 percent of the U.S. light vehicle market. 

[Image: Ford]

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Chris Teague
Chris Teague

Chris grew up in, under, and around cars, but took the long way around to becoming an automotive writer. After a career in technology consulting and a trip through business school, Chris began writing about the automotive industry as a way to reconnect with his passion and get behind the wheel of a new car every week. He focuses on taking complex industry stories and making them digestible by any reader. Just don’t expect him to stay away from high-mileage Porsches.

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19 of 62 comments
  • Lou_BC Lou_BC on Mar 15, 2023

    Tax credit:

    1. an amount of money that can be offset against a tax liability.

    “What should be done is for anyone who is going to use the golf cart tax credit to name which American will be paying for the user to have free money.”

    People need to get their facts straight. If one is supposed to pay 10k in assessed taxes and only needs to pay 5k due to a "credit", no one else is paying for your credit.

    It's your own money the government is letting you keep. That in itself is a different debate.

    • See 6 previous
    • EBFlex EBFlex on Mar 18, 2023

      "If you own a pickup with a GVW greater than 6,000 lbs with 6 ft box or longer and use it for business you can write off the entire amount. That isn't the case with cars. According to you, that should be unnecessary."

      So you can't answer the question. Got it.

  • 95_SC 95_SC on Mar 15, 2023

    You are welcome for your mortgage interest credit and your child tax credit (and probably your “earned” income credit.) Why I am forced to subsidize your trailer and all your fnck trophies is beyond me. Good to know if I buy a new EV that I’ll subsidize them a little less this year. Given statistics on who buys EVs this is likely the case in most instances

  • 28-Cars-Later 28-Cars-Later on Mar 15, 2023

    1. Mortgage Interest Credit... what black magic is this? Looking into it, it only reinforces my second point.
    2. The system prior to but especially after 2008 is complete fraud and taxation only now exists as a control and punishment mechanism. They have already demonstrated they will print to create whatever genocide/communism/dystopia is in the end game and inflation will only get worse as a consequence. You "voted" for it Amerika.

    • See 5 previous
    • 95_SC 95_SC on Mar 16, 2023

      I blame him for plenty. He lied on the wars for example. At least Biden kept his promise on that even if the actual withdrawal was a tactical blunder that will offer a case study at all levels of officer training in what not to do and he hasn’t held anyone accountable. Then again, he never said it wouldn’t be Saigon 2.0 I guess

  • VoGhost VoGhost on Mar 16, 2023

    There sure are a lot of comments from people who hate to see great manufacturing jobs returning to the US.

    • See 1 previous
    • EBFlex EBFlex on Mar 18, 2023

      "There sure are a lot of comments from people who hate to see great manufacturing jobs returning to the US."

      Show us who said that.