General Discussion Topics, page-94405

The US tax credits for Electric Vehicles started in January. The rules were thrown together quickly and it became apparent that some things needed to be re-thought out. The rules for getting the tax credit are based on % of raw materials from the US or Free Trade Partner, and % of assembly done in the US. For the first 3 months anyone who purchased an EV got the credit while they bicker over the wording of the law, but starting in April they are supposed to have the full law in place. It ramps up the % of raw material required by the US or FTP each year to encourage more locally source material.

Starting in April there will be very few who can say their car qualifies because so much of the LCE comes from China. The tax credits phase out in 2033 so there is a limited time to take advantage.

The auto makers have successfully argued that the tax credit should be given at the time of sale instead of waiting to receive it on a person's tax return. They did this so they can hide how much of the credit they are actually giving to the consumer. (oh yeah it will look like you get it all, but trust me you won't).

So I did a little break down of what sort of money we are talking about.

I use 30,000 tons of LCE to 500,000 EV's - this is a number that I have seen a few times and I know different battery sizes make different numbers of cars but we are talking 500,000 cars to 30,000 ton LCE average.

So that is 16.6 cars per 1 ton of LCE, which means for every tone of LCE purchased there will be (16.6 x $7500) or $124,500 per ton of LCE tax credit. The current contract rate for LCE is around $49,000, so basically your lithium is free plus you would have $75,500 left over to either use as sales incentives or simply pocket.

When Sayona says every major car company has been calling them, I believe it. I also wonder if the re-wording of the law is what has caused all of our announcements including OTA to be pushed into April. I can't imagine Sayona being over looked and perhaps a bidding war over getting the product.