Companies across North America and Europe have in recent months cheered the Biden Administration’s $430 billion U.S. Inflation Reduction Act (IRA) that includes major provisions to cut carbon emission, boost domestic production and manufacturing.
The act, signed into a law late last year by President Joe Biden, has also sparked a reaction from the European Union because of fears that it could lure businesses away from the bloc with its generous tax breaks.
Here is what some companies in Europe and U.S. have said about the U.S. Inflation Reduction Act:
Tesla Inc said on Wednesday it had begun assembling batteries in Germany but will focus cell production in the United States in light of incentives available through the IRA, making it one of the first firms to declare a strategy shift prompted by the law.
Sweden-based battery producer Northvolt said in November it would prioritize expansion in the United States over Europe, pointing that it could get up to 800 million euros ($848.40 million) in U.S. state aid to build a factory for batteries used in electric vehicles.
The world’s biggest cement maker expects the IRA to provide a strong momentum for its business in North America. This month, it agreed to buy U.S. roofing systems manufacturer Duro-Last in a $1.29 billion deal, its latest move to bolster presence in North America.
The gas giant has estimated the total investment opportunity for the company in the United States alone could exceed $30 billion over the next decade.
The luxury carmaker is poised to invest billions of euros to build 10,000 fast-charging points, starting in North America in 2023, targeting 2,500 charging points at 400 locations across most U.S. states and Canada by 2027.
Executives have said the automaker’s U.S. plant in Chattanooga, Tennessee, aims to build 90,000 electric vehicles in 2023, adding that the new ID4 is expected to qualify this year for the full $7,500 U.S. tax credit under the IRA.
The IRA is more efficient than the European Union aid to support domestic production of energy sector components, the CEO of Europe’s biggest utility Enel had said in December in an interview during the Reuters Next conference.
“The U.S. has a great package not only to change the infrastructure and the energy generation mix but also to help re-shore some critical components,” Enel’s Francesco Starace said.
The company plans to produce at least six fully electric models in its plant in South Carolina by 2030.