A deal struck among Democrats in the U.S. Senate appears to have eliminated a threat hanging over the nascent electric vehicle manufacturing industry in Canada. An agreement announced late Wednesday between Senate Democratic leader Chuck Schumer and Senator Joe Manchin of West Virginia gives the Democrats the votes they need to pass a key plank of U.S. President Joe Biden’s legislative agenda.
The deal would amend Mr. Biden’s climate and health bill and change the terms of tax credits for electric vehicles that as previously written would have only applied to autos assembled in the United States.
The amended language does away with the made-in-America criteria and instead says the tax credit would apply to electric vehicles assembled “within North America,” which means not only the United States but Canada and Mexico.
The proposed changes also require that the critical minerals used to build batteries for the electric vehicles “are extracted or processed in any country with which the United States has a free trade agreement.”
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