The push towards electric vehicles (EVs) is gaining momentum, and the U.S. government is providing significant incentives to encourage this transition. A key piece of legislation, the Inflation Reduction Act of 2022, has reshaped the landscape of EV tax credits, now known as the Clean Vehicle Credit. A critical requirement for many of these credits is that the electric vehicle must undergo final assembly in North America. This “final assembly” rule, effective from August 17, 2022, directly impacts which vehicles qualify for these valuable incentives.
For anyone considering purchasing a new electric, fuel cell electric, or plug-in hybrid electric vehicle, understanding this North American final assembly requirement is crucial. This article breaks down what you need to know about USA made electric vehicles and how assembly location affects eligibility for the Clean Vehicle Credit. We’ll explore the timelines, vehicle lists, and how to verify if your desired EV meets the criteria.
Understanding the Clean Vehicle Credit and “North American Made” EVs
The Clean Vehicle Credit, as part of the Inflation Reduction Act, aims to make clean energy vehicles more accessible to American consumers. For vehicles placed in service on or after January 1, 2023, the rules are continually being updated by the Internal Revenue Service (IRS) and the U.S. Department of the Treasury. Keeping up with these changes is essential for both buyers and sellers of electric vehicles.
Starting January 1, 2024, a significant change allows buyers to transfer their Clean Vehicle Credit to the dealer, effectively reducing the upfront purchase price of the EV. Previously, the credit was only received as a tax refund after filing. Now, dealerships must register with the IRS through IRS Energy Credits Online to confirm vehicle eligibility and credit amounts at the point of sale. This system ensures immediate benefits for consumers and streamlines the process. It’s important to note that without this IRS submission from the dealer, the Clean Vehicle Credit cannot be claimed.
For the purpose of the Clean Vehicle Credit, “North America” is defined broadly to include the United States, Puerto Rico, Canada, and Mexico. Therefore, “USA made electric vehicles” as well as those assembled in Canada and Mexico, can potentially qualify, provided they meet all other eligibility requirements.
List of North American Assembled Electric Vehicles (Potential Eligibility)
The following lists provide examples of electric vehicles assembled in North America. It’s important to remember that this list was initially compiled for vehicles purchased between August 17 and December 31, 2022, and while it gives a good indication of manufacturers and models, verification using the VIN decoder is always recommended for current purchases.
Note: Eligibility for the Clean Vehicle Credit involves several factors beyond final assembly location, and conditions may vary depending on the purchase date and specific IRS guidelines.
| Model Year | Vehicle | Manufacturer Sales Cap (Pre-2023 Purchases) |
|---|---|---|
| 2022 | Audi Q5 | |
| 2022 | BMW 330e | |
| 2022 | BMW X5 xDrive45e (PHEV) | |
| 2022 | Chevrolet Bolt EUV | Manufacturer sales cap met |
| 2022 | Chevrolet Bolt EV | Manufacturer sales cap met |
| 2022 | Chrysler Pacifica PHEV | |
| 2022 | Ford E-Transit | |
| 2022 | Ford Escape PHEV | |
| 2022 | Ford F-150 Lightning | |
| 2022 | Ford Mustang MACH E | |
| 2022 | GMC Hummer EV Pickup | Manufacturer sales cap met |
| 2022 | GMC Hummer EV SUV | Manufacturer sales cap met |
| 2022 | Jeep Grand Cherokee 4xe | |
| 2022 | Jeep Wrangler 4xe | |
| 2022 | Lincoln Aviator PHEV | |
| 2022 | Lincoln Corsair PHEV | |
| 2022 | Lucid Air | |
| 2022 | Nissan Leaf | |
| 2022 | Rivian EDV | |
| 2022 | Rivian R1S | |
| 2022 | Rivian R1T | |
| 2022 | Tesla Model 3 | Manufacturer sales cap met |
| 2022 | Tesla Model S | Manufacturer sales cap met |
| 2022 | Tesla Model X | Manufacturer sales cap met |
| 2022 | Tesla Model Y | Manufacturer sales cap met |
| 2022 | Volvo S60 Recharge | |
| 2023 | BMW 330e | |
| 2023 | BMW X5 xDrive45e (PHEV) | |
| 2023 | Cadillac Lyriq | Manufacturer sales cap met |
| 2023 | Chevrolet Bolt EV | Manufacturer sales cap met |
| 2023 | Ford E-Transit | |
| 2023 | Jeep Grand Cherokee 4xe | |
| 2023 | Jeep Wrangler 4xe | |
| 2023 | Lincoln Aviator PHEV | |
| 2023 | Lucid Air | |
| 2023 | Mercedes EQS SUV | |
| 2023 | Nissan Leaf | |
| 2023 | Rivian R1S | |
| 2023 | Rivian R1T | |
| 2023 | Tesla Model 3 | Manufacturer sales cap met |
| 2023 | Tesla Model S | Manufacturer sales cap met |
| 2023 | Tesla Model X | Manufacturer sales cap met |
| 2023 | Tesla Model Y | Manufacturer sales cap met |
| 2023 | Volkswagen ID.4 |
It’s important to note that some manufacturers, like Tesla and GM (Chevrolet, GMC, Cadillac), have already met the previous 200,000 EV credit sales cap for vehicles acquired before January 1, 2023. This cap no longer applies to vehicles purchased after December 31, 2022.
This list is dynamic and subject to updates as manufacturers provide new vehicle information to government agencies. For the most current information, always refer to official resources and the VIN decoder.
Verify “USA Made” Status and Assembly Location Using the VIN
While lists are helpful, the most reliable way to determine the final assembly location of a specific vehicle is by using its Vehicle Identification Number (VIN). Both a physical information label on the vehicle and online VIN decoders can provide this crucial detail.
The U.S. Department of Transportation’s National Highway Traffic Safety Administration (NHTSA) offers a free VIN decoder. By entering the VIN, you can access information about the vehicle’s build plant, country of manufacture, and other specifications.
To verify North American (including USA) final assembly:
- Locate the VIN: Find the 17-character VIN on the vehicle’s dashboard (driver’s side), doorjamb, or vehicle registration documents.
- Use the VIN Decoder: Go to the NHTSA VIN decoder website (https://www.nhtsa.gov/vin-decoder).
- Enter the VIN: Input the VIN into the decoder.
- Check Assembly Location: Review the decoder results for “Plant” and “Country of Manufacture.” Confirm that the “Country of Manufacture” is the United States, Canada, or Mexico to meet the North American final assembly requirement.
Keep in mind that for some manufacturers, assembly locations can vary based on the specific model, trim level, or production date within a model year. Always verify the VIN of the exact vehicle you intend to purchase.
Conclusion: Ensuring Your EV Credit Eligibility
The Clean Vehicle Credit offers significant savings for those purchasing new electric vehicles. Understanding the North American final assembly requirement is a vital step in determining eligibility. While “USA made electric vehicles” are a focus, remember that vehicles assembled in Canada and Mexico also qualify under this rule.
To ensure you maximize your chances of receiving the Clean Vehicle Credit:
- Confirm Final Assembly: Always use the VIN decoder to verify the final assembly location of the specific vehicle you are interested in.
- Stay Updated: EV tax credit rules are subject to change. Regularly check the official IRS Clean Vehicle Tax Credit page for the latest guidance.
- Consult Professionals: For specific eligibility questions, contact the vehicle manufacturer or consult a tax professional.
By taking these steps, you can navigate the EV landscape with confidence and potentially benefit from the valuable Clean Vehicle Credit when purchasing your next “USA made” or North American assembled electric vehicle.
