Chinese Looking into Morocco for U.S. Electric Vehicle Subsidies

( – The United States recently passed new subsidies that would boost domestic electric vehicle production, cutting into Beijing’s supply chain; this has resulted in Chinese manufacturers looking into Morocco instead.

They have announced plans for factories to make parts for electric vehicles that may qualify for over seven thousand dollars in credits to car buyers in the U.S. Investments that are similar to this have been announced in various countries that share free trade agreements with the United States.

The North African kingdom is seeing prospective investments from over eight Chinese battery-makers since Joe Biden passed the Inflation Reduction Act. The Inflation Reduction Act is a four-hundred billion-dollar United States law designed to fight climate change. By moving production to Morocco, Chinese battery makers at the top of the battery supply chain are able to take advantage of American carmakers like Tesla.

A senior battery analyst at the consulting firm Wood Mackenzie, Kevin Shang, said, “Chinese companies definitely don’t want to miss this big party.”

The European Union and the United States have imposed major tariffs on Chinese vehicle imports and the United States has finalized eligibility rules about the tax credits in recent months.

Giant industrial parks with American, European, and Chinese component makers have been popping up all over Morocco, making it a key place for production to continue. Morocco is now a key car manufacturing hub and they hope to meet the growing demand. They are currently fighting rules that would potentially exclude them from the incentives of the Inflation Reduction Act.

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