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International opposition mounts over proposed U.S. EV tax credit

Source: Reuters

WASHINGTON, Oct 30 (Reuters) – The European Union, Germany, Canada, Japan, Mexico, France, South Korea, Italy and other countries wrote U.S. lawmakers saying a proposed U.S. electric vehicle tax credit violates international trade rules, according to a joint letter made public Saturday.

A group of 25 ambassadors to Washington wrote U.S. lawmakers and the Biden administration late Friday saying “limiting eligibility for the credit to vehicles based on their U.S. domestic assembly and local content is inconsistent with U.S. commitments made under WTO multilateral agreements.”

The U.S. Congress is considering a new $12,500 tax credit that would include $4,500 for union-made U.S. electric vehicles and $500 for U.S.-made batteries. Only U.S. built vehicles would be eligible for the $12,500 credit after 2027, under a House proposal released this week.

Canada and Mexico have issued separate statements in the last week opposing the plan.The U.S. State Department declined to comment Saturday and the White House did not immediately respond to a request for comment.

The proposal is backed by President Joe Biden, the United Auto Workers (UAW) union and many congressional Democrats, but opposed by major international automakers, including Toyota Motor Corp (7203.T), Volkswagen AG (VOWG_p.DE), Daimler AG, Honda Motor Co, Hyundai Motor Co (005380.KS) and BMW AG (BMWG.DE).

A dozen foreign automakers wrote California’s two senators on Friday urging them to abandon the plan that they said would discriminate against the state. read more

UAW President Ray Curry said the provision will “create and preserve tens of thousands of UAW members’ jobs” and “would be a win for auto manufacturing workers.”

The EV tax credits would cost $15.6 billion over 10 years and disproportionately benefit Detroit’s Big Three automakers – General Motors (GM.N), Ford Motor (F.N) and Chrysler-parent Stellantis NV – which assemble their U.S.-made vehicles in union-represented plants.

The ambassadors that also include Poland, Sweden, Spain, Austria, Netherlands, Belgium, Cyprus, Ireland, Malta, Finland, Romania and Greece said the legislation would harm international automakers.

They said it “would violate international trade rules, disadvantage hard-working Americans employed by these automakers, and undermine the efforts of these automakers to expand the U.S. EV consumer market to achieve the (Biden) administration’s climate goals.”

The letter added it “puts U.S. trading partners at a disadvantage.”

Autoworkers at the foreign automakers in the countries that wrote are nearly all unionized but not in the United States.

“Our governments support workers’ right to organize. It is a fundamental right and should not be used in the framework of tax incentives, setting aside the opportunities for nearly half of America autoworkers,” they wrote.

Reporting by David Shepardson; editing by Diane Craft

Our Standards: The Thomson Reuters Trust Principles.

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The role and responsibility of ID verification in the automotive industry

Author: Terry Slattery, CEO at IDScan

Like many, the automotive industry is currently navigating through the complexities of digitalization and the escalating challenge of identity fraud. As the industry shifts towards online sales, remote vehicle rentals, and the launch of ride-sharing platforms, they must ask a crucial question: How can the authenticity of customer identities be correctly verified? 

This is a real issue that needs to be tackled, with an estimated 10% of digital inquiries for car transactions flagged for potential fraud risks. Such threats expose dealerships and rental services to significant financial losses and safety risks, underscoring the urgent need for effective identity verification measures. 

With traditional methods of identity checks proving to be increasingly outdated, propelling the industry towards innovative measures could be the solution to greater levels of security and efficiency in the industry. 

Why AI matters – The crucial role of digital ID verification

The threat of fake IDs and fraudulent activities within the automotive industry isn’t just about financial repercussions, it extends to the safety of employees and customers, where a failure in identity verification can lead to severe consequences. For example, just last year, a woman used a fake ID and a modified driver’s licence to scam a dealership into letting her acquire a new car worth over $42,000. This was not the first of her many fraudulent activities record, but it served as a wake-up call for the dealership to start taking more severe safety measures.

Implementing advanced digital ID verification systems could be the way to mitigate these risks, shifting from traditional, often manual, verification methods towards newer technologies. These systems harness AI to compare identification documents against vast databases of authenticated templates, analyzing every detail from the document’s physical characteristics to hidden security features. Infrared and ultraviolet light scanning can detect the latter, such as holograms and watermarks, and a comprehensive library of ID templates to ensure each document adheres to state or jurisdictional standards.

Furthermore, digital enhancements like 2D barcode checks and face match technology with anti-spoofing measures can validate identities more accurately. By incorporating DMV data verification, dealerships can cross-reference customer details with official records, providing a robust, multi-layered approach to mitigate identity fraud and streamline the customer verification process. This level of security ensures that only legitimate users can access services, from taking a test drive at a dealership to renting a vehicle remotely through an app. 

The benefits of digital ID verification

Perhaps the biggest advantage of adopting digital ID verification is that it drastically reduces the incidence of identity fraud, providing a robust mechanism to catch fake IDs with up to 95% accuracy. This capability is crucial in an industry where the stakes involve high-value assets like vehicles. By ensuring that only verified customers can access services such as test drives and loan applications, dealerships significantly minimize their exposure to financial and reputational risks. 

These measures also automate the customer onboarding process. What once took minutes or hours can now be completed in a matter of seconds. The integration of these solutions allows for the quick and accurate transfer of verified data, facilitating smoother loan applications and dealership operations. 

By adopting digital ID verification, the automotive industry not only strengthens its defence against fraud but also enjoys more efficient and reliable customer verification processes, leading to increased customer satisfaction and improved operational workflow. The mere presence of digital verification technology also serves as a deterrent to potential fraudsters, promoting a more secure dealership environment and ensuring compliance with Red Flags Rule laws, which in turn guarantees that businesses have a solid system in place to detect and act on warning signs of identity theft effectively. 

How to implement digital ID verification

A successful implementation of digital ID verification relies on the solution’s ability to blend with the dealership’s operational framework without disrupting the workflow, connecting smoothly with dealership management systems (DMS) and customer relationship management (CRM) systems. This ensures data flows effectively between systems, enhancing efficiency.

It’s also crucial to educate the staff within the automotive industry, by offering training on the new system’s technical aspects and its significance in fraud prevention and regulatory compliance. This understanding reinforces digital ID verification as essential for dealership security and customer trust, aligning with federal KYC and privacy standards.

Viewing the integration of digital ID verification as an ongoing process rather than a one-time setup allows for continuous improvement and adaptation. Regular system evaluations, soliciting user feedback, and staying updated with technological advancements are critical for refining the verification process and ensuring that every interaction—be it a car purchase, a rental, or a ride-share—begins with the assurance of verified identity.

As the challenges of fake IDs and identity theft continue to rise, so should the security measures within the automotive industry. This is why the adoption of digital ID verification technologies will play a huge role towards safer, and more efficient transactions. By embracing these advanced technologies and making the effort to implement them accordingly, the automotive industry can navigate the complexities of identity verification with increased confidence. 

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Car cannibalism: What it is and 3 tips to avoid it

Mark Barclay, My Motor World

Car cannibalism has been on the rise now for several years — but what exactly is it, and what are the risks? More importantly, how can you ensure that your vehicles are protected? The good news is that there are ways to protect your car from thieves, and here My Motor World share a few of the best.

What is car cannibalism?

Car cannibalism refers to the crime of stripping a car for its parts without stealing the whole vehicle (though it may also be stolen in some cases). A lot of the time, the parts that are stolen are those most commonly needed to repair a car after a minor crash, such as bumpers, grills, lights, and fenders, or any other high-demand parts that thieves can sell to make a profit. Other times, thieves may steal to order, meaning they target vehicles with specific desirable parts or expensive add-ons with resale value. Because of this, every kind of car from pricey vehicles to those popular with young drivers are at risk.

How to avoid car cannibalism

The best way to protect your car from thieves is to keep it out of sight. But even if you have been targeted, there are still ways you can deter a theft in progress or potentially recover your stolen parts afterwards.

Park in a safe area

Always park your car in a safe area, even when parking for short durations. For long stays, private car parks and garages are the safest as they are usually locked and have CCTV or other security measures in place.  However, if you don’t have access to one of these, then a well-lit area with lots of footfall may be enough of a deterrent. Since many of the parts being stolen are from the front of the vehicle, it could be useful to park facing a wall where possible to make the theft more difficult. Always ensure that your vehicle is locked and take your keys with you — not only is this safer, but many car insurance premiums won’t pay out if you haven’t properly secured your car.

Mark your parts

It’s unlikely you’ll ever recover your parts if they are stolen but marking them can make it easier for the police to identify, which means you potentially could get your stolen parts back. In some cases, marked parts can be a deterrent if the thief notices the marking, as they’ll be more reluctant to steal a part that can be traced. People buying the parts may also realise they have been stolen if they’re marked, and if so, they may be more likely to contact the police. 

Use technology

It’s worth putting a camera in your vehicle such as a dashcam if you haven’t already, and a tracker can help you locate your car in the event that it is stolen. If you park in a driveway or just outside your home, a video camera on your property may catch the thieves in the act and prove useful to the police investigation. A security light that goes on when it senses movement can even be enough of a deterrent, and both of these options may be cheaper than replacing the stolen parts.

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Is misinformation putting the brakes on the used EV market?

Jordan Brompton, co-founder and CMO of myenergi, explores the latest second-hand EV sales data and discusses whether dated views and misconceptions are holding back the transition to electrification.

According to insight from the Society of Motor Manufacturers and Traders (SMMT), more than 30,500 second-hand battery electric vehicles (BEVs) changed hands in the second quarter of 2023, an 81.8% rise on the same period last year.[1] Used plug-in hybrids (PHEVs) also grew in popularity, with sales up 11%.

In terms of availability, a quick search on Autotrader brings up more than 16,500 results for used BEVs and nearly 11,000 results for used PHEVs, spanning 47 manufacturers and hundreds of models – from hatchbacks and hybrids to coupes and convertibles. The choice is truly vast, and availability is immediate.

While you can’t miss the mix of top-end nearly new models pushing upwards of £100k, there’s also a huge choice of cars for far less than £17,920[2] – the average UK spend on a second-hand vehicle. You might have to compromise a little when it comes to colour, features or mileage, but the listings are packed with brilliant buys!

The used EV market should be thriving – and such impressive growth figures suggest that progress is building fast. However, when you dig beneath the surface, the reality is a little different. Indeed, as a percentage of total used car sales, plug-in vehicles comprise less than 2% of transactions. There seems a dichotomy between the growing opportunity and lacking consumer confidence.

But why? Well, even though the choice is there, many motorists are still put off by misinformation. From battery systems failing and range figures plummeting, to planned obsolescence after an initial three-year finance deal is up, we’ve all heard the rumours.

But what’s the truth? How long can you really keep an EV? When will you need a new battery? Does the range start to drop quickly after purchase? What’s more, with energy market volatility seeing electricity prices rocket, do the risks really outweigh the benefits of EV over ICE?

Are used EVs a ticking time bomb?

In short, no. While perceived battery life is still a concern for some motorists, experts suggest that the average electric vehicle battery (EVB) can last almost 20 years, or 200,000 miles – a significantly longer lifespan than the typical internal combustion engine and far longer than today’s average length of vehicle ownership. What’s more, while battery efficiency will eventually start to drop, the average EV will lose just 2% of accessible range per year – an arguably minor decline.

It might sound obvious, but the latest models have been designed to far outperform their petrol and diesel predecessors. Significant investment has been made by manufacturers into designing ever-more capable vehicles to suit the needs of tomorrow’s drivers and it really shows. The EVs of today, which include those on our list, have excellent ranges, impressive durability and are cheap to maintain thanks to fewer moving parts.

The anti-EV movement will tell you otherwise, but electric vehicles aren’t designed to fall apart after a few years. They’re not programmed to break, to slow down, to lose efficiency or to rack up costly servicing bills. Vehicle manufacturers are pioneering the future with cars that really are here to stay.

So, while scaremongering is commonplace, switching to electric really is the sensible option for motorists. Need a nippy run-around for your trips into town? There’s countless hatchbacks that’ll suit you down to the ground. Need something a little bigger for motorway journeys? You can pick up an SUV, saloon or estate that’ll keep on going for another decade.

But what about the elephant in the room? The volatile energy market and high electricity bills. Will your used EV quickly become a drain on your finances? Will the price cap rise far above falling petrol prices, leaving me between a rock and a hard place? All important questions but, again, motorists shouldn’t be concerned.

While the environmental benefits of EVs are widely publicised, the financial benefits are equally as impressive. At current prices, a small hatchback would cost less than £650 per annum for the average driver to run if they charge at home. Even though these prices will increase when the energy price cap changes, EVs will still be the most cost-efficient option by far – especially with fuel prices pushing £1.50 per litre (for diesel) and an average tank (55 litres) costing upwards of £80.

The real cheat is if you have a solar array and an eco-smart home EV charger, like the myenergi zappi. In this instance, you can effectively charge for free by self-consuming your self-generated renewable energy – zero fossil fuels, zero reliance on the grid, zero emissions travel. Of course, it requires an up-front investment, but the ability to take total control of your home energy use is an attractive one.

So, should you look to the used market for your next EV? Well absolutely – there really is something for everyone. What’s more, with a huge selection and less than average demand, you’ll likely grab a steal!

As we move ever-closer towards 2030, however, the used EV market must become a key part of the UK’s transition to electrification. The laggards and self-professed petrolheads will continue to spread misinformation, but the reality is really quite different from the current driver perception. Let’s not allow rumours to slow the transition to electrification.


[1] Second-hand electric vehicle sales soar to record levels | Business News | Sky News

[2] https://plc.autotrader.co.uk/news-views/retail-price-index/

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