Treasury has started issued some clarifications and intends to issue proposed guidance on the critical mineral and battery component requirements by March 2023. I'd expect a number of off-take deals across multiple metals and minerals to be announced very quickly after this confirmation so that the construction of a new American centric supply line can start. IMO a key factor in E25's delay is that OEM/Battery makers need clarity on the finer details of the game. There is a lot more risk in finalising deals before knowing exactly what the rules are. As much as anything else I think this is what has slowed down E25 relative to its original intentions because the OEM's are still figuring out how to hit the progressive steps from 40% to 80%.
Some initial interpretations have come out and in an initial read I can't see anything reducing the need for a non-Chinese source of Mn and this will be wanted quickly.
One of the issues was what happens if you have a 45% local product vehicle that you sell it to a customer in 2024 (when the criteria is 40%) but there is a delivery waiting list. Delivery occurs in 2025. Treasury have come down on the hard interpretation side and deemed "placed in service" to be the date the taxpayer takes possession. This will mean that vehicles that may be placed in service in either Nov/Dec or Jan/Feb will need to be designed to the Jan/Feb compliance percentages or otherwise risk becoming ineligible for subsidy car's. This will bring forward demand for American and allies based supplies of input materials as cars planned to roll of the production line late each year (but not delivered to the customer until the next year) will need to hit the next year (higher) thresholds to get subsidies.
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