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Hyundai is offering EV buyers up to $7,500 cash after missing out on tax credits

Hyundai is offering cash bonuses to EV buyers as it attempts to compete with the small number of models eligible for a federal tax credit.

The Korean automaker will give customers up to $7,500 if they buy an Ioniq 5, Ioniq 6, or Kona Electric car before Jan 31, per its website.

The move comes after Hyundai failed to qualify for the $7,500 tax incentive introduced by Joe Biden’s Inflation Reduction Act.

New rules that aim to boost sales of cars made in America mean the vast majority of EVs no longer qualify for the credit.

Just 13 EVs are on the list, which includes the popular Tesla Model Y and X, as well as vehicles made by Ford and Rivian.

The restrictions, which took effect on January 1, mean EVs containing materials from China or any other “foreign entity of concern” are ineligible for the tax credit.

Hyundai was one of a number of carmakers who couldn’t meet that bar, and has turned to cash bonuses to try to compete with the few that did.

The automaker is building a $7.6 billion EV factory in Georgia as quickly as possible, executives told The Associated Press, to comply with the new rules.

Hyundai, along with its sister company Kia, was second to Tesla for EV sales in the US last year, according to data from BloombegNEF.

However, its combined total was about 70,000 compared with more than 500,000 EVs sold by Elon Musk’s company.

The low number of electric vehicles that now qualify for the $7,500 rebate has fuelled fears that buyers could turn away from EVs due to high prices, with demand slumping in recent months.

However, the expiration of the tax credits appeared to spark a mini-sales rush, with new EV sales jumping 20% from December 31 to January 7, according to data from AI car shopping app CoPilot.

Hyundai did not immediately respond to a request for comment from Business Insider, made outside normal working hours.

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