There's little doubt the Inflation Reduction Act will have a seismic effect on the U.S. electric vehicle industry, but the dust hasn't yet settled on the details that will determine the affordability of different makes and models now on the market.
Major players are already requesting tweaks and adjustments to the act. If enacted as written, the new law could have the unintended consequence of actually suppressing sales of North American EV manufacturers, because few, if any, can meet all aspects of the supply chain criteria in the language.
If this and other issues are addressed, however, a couple of basic trajectories will have been set that carry long-term implications on supply and demand.
First and perhaps most obvious is the clear effort by the act to support domestic EV manufacturing. Vehicles made outside North America do not qualify for new federal tax incentives.The second is the effort to democratize demand. To attract Main Stre…