Five Hot Button Trade Issues for the Electric Mobility Industry in 2023

Electric Mobility
In 2022, rare bipartisan cooperation succeeded in passing much of what Washington had in mind for the electric mobility industry, including billions of dollars in new spending now enshrined in the 2022 Inflation Reduction Act (IRA).

That support, however, came with strong concern that the US electric vehicle (EV) industry remains vulnerable to unfair competition from abroad, and it is this uncertainty that will trigger tighter and more intrusive scrutiny on imports of critical components and products.

In 2023, the nexus of corporate strategy and US trade rules will present uncertainty for many EV companies and their suppliers involved in cross-border transactions. It is the reason our Electric Mobility Practice Group has put together this special issue. A sophisticated understanding of the trade rules impacting this fast-evolving industry can minimize risk and maximize tariff reduction opportunities.

Washington’s Focus on the Electric Vehicle Supply Chain in 2023

If a picture is worth a thousand words, the “photo-op” of the president test driving Ford’s new electric F-150 in May of 2021 was the burning image that foretold the US policy direction for the electric mobility industry. In 2022, the president and US Congress solidified their support of the industry by passing sweeping legislation aimed at funding and incentivizing US electric mobility manufacturing for the next decade and beyond.

Read our analysis. 

Section 301 Four-Year Review: A Black Box for the EV Supply Chain

Since 2018, the Section 301 “China” tariffs of between 7.5% and 25% have been levied against critical components of the electric vehicle (EV) supply chain sourced from China. In May 2022, the US Trade Representative (USTR) initiated a statutory and ongoing four-year review of the tariffs to determine which will stay or go, or even if other tariffs should be added. 

Read our analysis.

The USMCA – More than A Trade Agreement, A Competitive Strategy: Four Big Questions

In July 2020, the US-Mexico-Canada Agreement (USMCA) marked a turning point for North American cross-border trade, creating new rules and opportunities. This has been especially true for participants in the electric vehicle (EV) industry. Now approaching the start of its fourth year, the USMCA represents a powerful way for companies in this space to maximize access to the United States in a highly competitive global market, as long as they can navigate the pitfalls and challenges. 

Read our analysis.

The US Inflation Reduction Act – The EV World is Watching

Enacted in August of 2022, the Inflation Reduction Act (IRA) was heralded by many as a landmark climate legislation in the United States. While the IRA’s tax credits for electric vehicles (EV) were among its most anticipated benefits, the tax credits that ultimately materialized have various unanswered questions that may pose challenges to an industry still dependent on a global supply chain. 

Read our analysis.

Re-Thinking Strategies for Classification Challenges Ahead for New EV Technologies

Application of US trade laws rely on the proper classification of the imported product. It triggers tariff preference benefits when properly applied, and enforcement scrutiny when not. In 2022, the Harmonized Tariff Schedule of the United States (HTSUS) underwent a major overhaul. Although the update included tariff codes for certain products in the electric vehicle (EV) and automotive industry, the static nature of customs laws and regulations makes it difficult for the agency to keep up with the fast-paced introduction of new e-products. As a result, the proper HTSUS classifications for the EV supply chain will continue to lag behind technological advancements of this industry.

Read our analysis.


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