Biden administration sets limits on Chinese content in EV batteries, offers exemptions.

The Biden administration has issued long-awaited guidance limiting Chinese content in batteries eligible for electric vehicle tax credits from next year. As part of an effort to reduce dependence on China in the electric vehicle battery chain, the U.S. Treasury will temporarily exempt certain trace critical minerals from new rules affecting materials from China and other countries designated as “Foreign Entities of Concern.” The exemption is expected to last for two years and aims to prevent a significant number of vehicles from becoming ineligible for tax credits. Automakers, including General Motors and Ford, are closely monitoring these regulations as they plan investments in battery production for electric vehicles.