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Biden tariffs spark fight over EV battery costs

By David Ferris, Hannah Northey | 07/03/2024 06:56 AM EDT

The administration is navigating tricky politics while trying to both build a domestic supply chain and lower EV prices.

Recycled graphite is pictured in a laboratory of the Helmholtz Institute Freiberg for Resource Technology in Freiberg, Germany.

Recycled graphite attached to air bubbles is pictured. Jens Schlueter/AFP via Getty Images

American automakers are pressing the Biden administration to pause tariffs on Chinese graphite, arguing that prices for electric vehicles will go up if the levies are put in place too soon.

But a mining company processing graphite in the U.S. is asking the government to do the opposite — and put the trade protections in place sooner and at much higher levels to create a robust domestic supply.

The conflict over an obscure mineral shows how small components of emerging technologies could have an outsize impact on a future U.S. economy that centers on production of EVs and batteries.

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“There aren’t very good options for diversifying away” from Chinese graphite, said Adam Hersh, a senior economist at the Economic Policy Institute, a nonprofit think tank based in Washington, D.C. No matter what, building a domestic industry involves “a lot of upfront cost,” he said.

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