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Exploring how the way we live influences climate change and its impact across the Carolinas. You also can read additional national and international climate news.

North Carolina EV battery industry holds steady amid tax credit rollbacks

Once fully operational, Toyota will produce lithium-ion batteries for battery, hybrid and hybrid plug-in electric vehicles at a mega-site in Liberty, NC.
Toyota
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Once fully operational, Toyota will produce lithium-ion batteries for battery, hybrid and hybrid plug-in electric vehicles at a mega-site in Liberty, N.C.

Move over tobacco — there’s a new cash crop in town.

Part of the “battery belt,” North Carolina will soon be home to four major factories producing lithium-ion batteries, the power behind electric vehicles. But President Trump’s sweeping federal reconciliation bill eliminated tax credits for purchasing an electric vehicle, raising concerns about the future of the industry. 

Consumers will bear the brunt of the cost increase after EV tax credits end in September — and there are fears of a dip in demand. North Carolina manufacturers, however, say they’re unfazed.

Toyota began production at its battery factory outside of Greensboro in June. In a statement to WFAE, factory leaders said they remain committed to producing batteries for battery, hybrid and plug-in hybrid vehicles.

"Incentives can be helpful but are often temporary or subject to changing political dynamics," the statement read. "As a result, Toyota makes long-term investment decisions based on the market, not incentive opportunities."

Hannah Budds, a policy analyst at the North Carolina Sustainable Energy Association, credits North Carolina’s momentum to a flurry of major clean energy projects announced following the Inflation Reduction Act in 2022. Twenty-nine projects were announced for North Carolina, amounting to over $21 billion in investment.

"There will be negative impacts, but we already have so much forward momentum that there is going to continue to be growth, and this one moment is not going to define the industry as a whole," Budds said.

On the driver's side, the N.C. SEA is discussing programs and policies to make EVs more affordable, a concern that existed even with the tax credits. Kelley Blue Book estimates the average cost for a new EV is nearly $58,000, about $10,000 more than a new gas-powered car.

"At the end of the day, I know the price tag can really deter a lot of low- to moderate-income folks," Budds said. "I think we can be creative in terms of figuring out how to support those communities."

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Stella Mackler is a climate reporting intern at WFAE. She’s the editor of the student paper at Davidson College, where she studies environmental science.