The landscape of electric vehicle (EV) incentives in North America shifted significantly with the Inflation Reduction Act of 2022. A key change to the Clean Vehicle Credit, formerly known as the Qualified Plug-in Electric Drive Motor Vehicle Credit, is the final assembly requirement in North America, effective from August 17, 2022. This update has major implications for EV buyers looking to take advantage of tax credits.
This article, brought to you by Car Repair Online experts, dives deep into this crucial assembly requirement. We’ll break down how it impacts your eligibility for the Clean Vehicle Credit, particularly if you’re considering financing options like those offered by Ford Credit. While we won’t delve into the specifics of “does ford credit repo cars” in this article, understanding the financial incentives available can certainly influence your purchasing decisions and overall vehicle affordability.
Understanding the North American Final Assembly Rule
The Inflation Reduction Act (Public Law 117-169) brought about amendments to the Clean Vehicle Credit (IRC 30D). For EVs, fuel cell electric vehicles (FCEVs), and plug-in hybrid electric vehicles (PHEVs) acquired, delivered, and placed in service after August 16, 2022, final assembly in North America became a prerequisite for eligibility.
This means that to qualify for the Clean Vehicle Credit, the vehicle must have been assembled in:
- The United States
- Puerto Rico
- Canada
- Mexico
This requirement is a critical first step in determining if a vehicle qualifies for the credit. However, it’s important to note that final assembly in North America is not the only condition for eligibility.
Clean Vehicle Credit: Key Dates and Updates
The rules surrounding the Clean Vehicle Credit have evolved, especially for vehicles placed in service on or after January 1, 2023. For the most current and detailed information, always refer to the official IRS guidelines. You can also find a list of incentives by vehicle on FuelEconomy.gov. For a general overview of the credit, Car Repair Online offers a summary on our Electric Vehicle (EV) and Fuel Cell Electric Vehicle (FCEV) Tax Credit page.
A significant update starting January 1, 2024, is the ability for buyers to transfer the Clean Vehicle Credit to the dealer at the point of sale, effectively reducing the upfront purchase price. Previously, the credit could only be claimed when filing taxes. Dealers now need to register through IRS Energy Credits Online and submit vehicle information to the IRS to determine eligibility and credit amount at the time of purchase. Without this IRS submission, buyers cannot claim the credit. Dealers are also required to provide buyers with a copy of the IRS approval. For the latest dealer and consumer information on this transfer process, consult the IRS Clean Vehicle Tax Credit page.
Vehicles Purchased Between August 17 and December 31, 2022
The North American final assembly requirement specifically applies to vehicles purchased and delivered within this timeframe. The list below, based on Fuel Economy labeling information and Part 583 data submitted by manufacturers to the EPA and NHTSA as of December 31, 2022, outlines vehicles that met this assembly requirement for Model Year 2022 and 2023.
For vehicles purchased on or after January 1, 2023, verifying final assembly should be done using the VIN decoder discussed later in this article. Further details for vehicles purchased between August 17 and December 31, 2022, can be found on our Electric Vehicle (EV) and Fuel Cell Electric Vehicle (FCEV) Tax Credit page and the IRS Qualified Plug-in Electric Drive Motor Vehicle Credit resource.
It’s also important to be aware of manufacturer sales caps that applied to vehicles acquired before January 1, 2023. Some manufacturers reached the 200,000 EV credit limit, which could affect the full tax credit eligibility for vehicles purchased before this date. This sales cap is no longer applicable for vehicles acquired after December 31, 2022.
Here’s a list of Electric Vehicles Assembled in North America for vehicles purchased between August 17 and December 31, 2022:
Note: Additional eligibility conditions may apply based on the purchase date.
| Model Year | Vehicle | Manufacturer Sales Cap (applies to vehicles placed in service before January 1, 2023) |
|---|---|---|
| 2022 | Audi Q5 | |
| 2022 | BMW 330e | |
| 2022 | BMW X5 xDrive45e (PHEV) | |
| 2022 | Chevrolet Bolt EUV | Manufacturer sales cap met |
| 2022 | Chevrolet Bolt EV | Manufacturer sales cap met |
| 2022 | Chrysler Pacifica PHEV | |
| 2022 | Ford E-Transit | |
| 2022 | Ford Escape PHEV | |
| 2022 | Ford F-150 Lightning | |
| 2022 | Ford Mustang MACH E | |
| 2022 | GMC Hummer EV Pickup | Manufacturer sales cap met |
| 2022 | GMC Hummer EV SUV | Manufacturer sales cap met |
| 2022 | Jeep Grand Cherokee 4xe | |
| 2022 | Jeep Wrangler 4xe | |
| 2022 | Lincoln Aviator PHEV | |
| 2022 | Lincoln Corsair PHEV | |
| 2022 | Lucid Air | |
| 2022 | Nissan Leaf | |
| 2022 | Rivian EDV | |
| 2022 | Rivian R1S | |
| 2022 | Rivian R1T | |
| 2022 | Tesla Model 3 | Manufacturer sales cap met |
| 2022 | Tesla Model S | Manufacturer sales cap met |
| 2022 | Tesla Model X | Manufacturer sales cap met |
| 2022 | Tesla Model Y | Manufacturer sales cap met |
| 2022 | Volvo S60 Recharge | |
| 2023 | BMW 330e | |
| 2023 | BMW X5 xDrive45e (PHEV) | |
| 2023 | Cadillac Lyriq | Manufacturer sales cap met |
| 2023 | Chevrolet Bolt EV | Manufacturer sales cap met |
| 2023 | Ford E-Transit | |
| 2023 | Jeep Grand Cherokee 4xe | |
| 2023 | Jeep Wrangler 4xe | |
| 2023 | Lincoln Aviator PHEV | |
| 2023 | Lucid Air | |
| 2023 | Mercedes EQS SUV | |
| 2023 | Nissan Leaf | |
| 2023 | Rivian R1S | |
| 2023 | Rivian R1T | |
| 2023 | Tesla Model 3 | Manufacturer sales cap met |
| 2023 | Tesla Model S | Manufacturer sales cap met |
| 2023 | Tesla Model X | Manufacturer sales cap met |
| 2023 | Tesla Model Y | Manufacturer sales cap met |
| 2023 | Volkswagen ID.4 |
This list is subject to updates as manufacturers provide new information to government agencies. For corrections, manufacturers can use the website contact form. See details for manufacturers for more information.
Vehicles Purchased Before August 17, 2022
For vehicles purchased before August 17, 2022, the North American final assembly requirement does not apply for tax credit eligibility. Refer to Electric Vehicle (EV) and Fuel Cell Electric Vehicle (FCEV) Tax Credit and IRS Qualified Plug-in Electric Drive Motor Vehicle Credit for further details on these vehicles.
Utilizing the VIN for Assembly Location Verification
To confirm the assembly location of a specific vehicle, the Vehicle Identification Number (VIN) is crucial. Both the VIN itself and information labels on the vehicle can provide this information. The NHTSA VIN decoder is a valuable tool to identify the build plant, country of manufacture, and other vehicle details. Use the VIN decoder below to look up a vehicle’s assembly location:
[VIN Decoder Link/Form – Ideally, this would be an embedded VIN decoder if possible, but for this text format, a link is sufficient]
Verifying North American final assembly is a preliminary step. Remember that other eligibility criteria exist for the Clean Vehicle Credit, depending on the purchase date. For vehicles placed in service from January 1, 2023, onwards, consult IRS Credits for New Electric Vehicles Purchased in 2023 and After. For any eligibility questions, contact the vehicle manufacturer or consult the IRS information.
Keep in mind that for some manufacturers, assembly locations can vary based on the specific vehicle, trim level, or production date within the model year. This is because certain models may be produced in multiple locations. Always verify the VIN or check the vehicle’s information label to confirm the assembly location of the specific vehicle you are interested in. For VIN-related or other qualifying information questions, consumers should reach out to the manufacturer directly.
Final Assembly in North America Defined: For the Clean Vehicle Credit, “North America” is generally defined as the United States (including Puerto Rico), Canada, and Mexico for final assembly location purposes.
Disclaimer: The information provided here is for informational purposes and should not be considered official or legally binding. For complete details and the most up-to-date eligibility requirements, always refer to IRS.gov/cleanvehicles.
