President Biden signed the Inflation Reduction Act into law earlier this month and it brings sweeping changes to America’s electric vehicle tax credit.
Under the new scheme, vehicles produced in North America are favored and this has ruffled feathers across the globe. In particular, the European Union has already blasted it as discriminatory and a possible violation of World Trade Organization rules.
They’re not alone as a new report suggests South Korean officials have voiced their concerns to the Biden Administration. Citing a source, The Korean Times is reporting that Foreign Minister Park Jin brought up the issue with U.S. Secretary of State Antony Blinken on Friday.
Also Read: These 34 Electric Cars Won’t Qualify For Biden’s New EV Tax Credits
Details about the call are vague, but Park reportedly pushed for a “flexible implementation” of the law as Hyundai, Genesis, and Kia are obviously worried about the repercussions. Their alarm is well warranted as the US Department of Energy’s list of electric vehicles assembled in North America doesn’t include a single one from a Korean automaker.
It remains unclear how heated the reported discussions became, but the publication noted Park has said the Inflation Reduction Act may violate the South Korea-U.S. Free Trade Agreement and the “most-favored-nation treatment principle under the World Trade Organization agreements.” Officials with the country’s People Power Party have also said Korean-built EVs should enjoy the same tax benefits as American-made models due to the free trade agreement. Representative Kweon Seong-dong is also said to have claimed the “export of around 100,000 cars may be hindered” because of the new law.
All of this promises to make the already messy EV tax credit even messier as well as a diplomatic headache to boot.
