USMCA partners, OEMs retaliate against US vehicle tax credit talks

A US congress debate over a bill involving $12,500 tax credit on electric vehicles (EV) in addition to a $4,500 credit for those built by union workers in the United States has come under criticism.

Besides USMCA partners Canada and Mexico, various automakers are retaliating against the bill under discussion as it favors specific automobile plants in the US. 

For one, Mexico’s economy minister Tatiana Clouthier has threatened to retaliate if the bill is passed, stating that the measure “is totally contrary to free trade”. One thing Mexico could do in retaliation is impose tariffs on vehicles which are built in the US and sold in Mexico. 

Meanwhile, automakers in the US such as Toyota, Honda, and Tesla, have also complained about the bill, stating that it discriminates against workers who are not unionized.

Photo: Canada, USA, Mexico flags (copyright: Shutterstock)