As Ford Authority reported in January, China was previously planning to slash subsidies on new-energy vehicles (NEVs) including electric cars by 30 percent in 2022 before ending them altogether by the end of the year. However, after that country’s economy faced a slowdown following the COVID-19 pandemic, government officials quickly began having second thoughts and entered discussions with automakers with the idea of extending those subsidies, making Ford EVs more affordable for the masses. Now, China will reportedly continue to offer this incentive after all, according to Reuters.
China has reportedly decided to extend its purchase tax exemption on NEVs through the end of 2023, which is expected to result in total tax cuts of around 100 billion yuan ($14.6 billion USD). The move comes as overall automotive sales are down in the country, which is pushing to transition to EVs exclusively in the coming years.
With the EV transition moving along a bit faster than expected in the U.S., Ford EVs were also in danger of losing their eligibility for the $7,500 federal tax credit by early 2023 as well. However, just last week, a bill was passed that reforms the existing federal credit and keeps Ford EVs and those from other automakers at or over the current cap of 200,000 units eligible for tax credits through the end of 2032, as part of the Inflation Reduction Act of 2022.
There are some caveats to this new bill – dubbed the Clean Vehicle Credit – however, including the fact that qualifying vehicles must go through the final assembly process in the U.S. to be eligible. Additional stipulations will be added next year, but for now, a number of Ford EVs and PHEVs qualify for the credit, including the Ford E-Transit, Ford F-150 Lightning, Ford Mustang Mach-E, Ford Escape PHEV, Lincoln Corsair Grand Touring, and Lincoln Aviator Grand Touring.