Global power battery fierce game and comprehensive competition

In order to compete for the pricing power and dominance of global new energy, the fierce game and comprehensive competition of power batteries are sweeping the world.

More than ten days ago, on December 1, the US DEPARTMENT OF ENERGY (DOE) issued an explanatory document on the "Sensitive Foreign Entity of Concern (FEOC)", which once again caused public opinion and even industry shock.

In fact, the FEOC interpretation issued by the DOE is intended to implement the relevant requirements of the previous IRA Act (the Inflation Reduction Act). If an entity is owned, controlled, or subject to the jurisdiction of China, Russia, North Korea, or Iran (later referred to as the "Four countries"), the entity is considered a FEOC. Starting in 2024, electric vehicles eligible for the tax credit in the U.S. market will not include any battery components manufactured or assembled by FEOC. Starting in 2025, EVs eligible for the tax credit must not contain any critical minerals extracted, processed or recycled by the FEOC.

Back in August 2022, in the US Inflation Reduction Act, the US government said it would give certain tax subsidies to locally produced cars. In addition, electric vehicles must meet the two conditions of "critical minerals in a certain percentage of the value of the battery must come from the United States or the United States Free Trade Agreement countries" and "battery components manufactured or assembled in North America are greater than a certain percentage" to qualify for a tax credit of $7,500 per vehicle, and only one of them can get a tax credit of $3,750.