TOKYO: Japan joined the European Union in calling planned US aid for local electric-vehicle manufacturers "discriminatory” and demanded equal treatment for the nation’s car makers.
The country’s automakers may hesitate to invest in the electrification of vehicles in the world’s largest economy if the US offers "discriminatory incentives” to local manufacturers, Japan’s government said in a statement dated last Friday.
"This could cause negative impacts on the expansion of investment and employment in the US,” it said in the statement.
A multinational dispute has been raging over the recently passed US Inflation Reduction Act and subsidies to be provided through it to support green technologies in the country. The EU, South Korea and other trading partners see the aid as unfair.
The US should give Japan "treatment no less favourable” than North American countries regarding requirements concerning the final assembly of autos, critical minerals used for them, and their battery components, according to the statement.
The requirements of the electric vehicles tax credit are "not consistent” with the US and Japan’s shared policy to work with allies and like-minded partners to build supply chains, the Japanese government said.
They "preclude Japanese businesses from enjoying the benefit,” it said.
Japan has submitted these demands to the US Treasury Department and Internal Revenue Service in response to a request for comments on Credits for Clean Vehicles.
