Slate, a Michigan-based automotive startup, officially unveiled last week its new modular electric pickup truck, the cheapest ever produced in the United States. With a starting price below $25,000, the vehicle aims to democratize electric mobility but hides a strategic twist: it uses lithium iron phosphate (LFP) batteries, a technology invented in the U.S. but perfected in China. This choice was made possible by the recent repeal of federal EV tax credits, a move pushed by the Trump administration that removed restrictions on battery sourcing.
Tax credit repeal opens door to cheaper Chinese LFP batteries
Until last year, the $7,500 tax credit under the 2022 Inflation Reduction Act required batteries to be assembled in the U.S. using materials from allied countries, effectively excluding China, labeled a 'foreign entity of concern.' This had pushed manufacturers to avoid LFP batteries, which are dominated by China for nearly 98% of global cathode production. With the credit repealed by the Republican-led Congress last summer, U.S. automakers lost the incentive to meet those restrictions and could freely tap into the cheaper, well-established Chinese supply chain.
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Slate chose to partner with Gotion, a U.S. subsidiary of a Chinese firm, which will manufacture the batteries in Illinois. The pickup offers a range of 205 miles per charge, up from the initially planned 150 miles. 'The battery pack had to meet targets for durability, reliability, and affordability,' said Jeff Jablansky, a Slate spokesman, in a statement to WIRED. While the base model is spartan (power windows and speakers are optional), the low price represents a breakthrough for the U.S. EV market, which BloombergNEF predicts will shrink by 19% this year precisely because of the policy change.
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Other manufacturers follow suit toward cheaper batteries
Slate is not alone in turning to LFP. Tesla already uses this chemistry for its standard-range Model 3 and Model Y, while Ford has announced a small electric pickup competitor developed by its 'skunkworks' team in California, also based on LFP. GM has said it will temporarily import LFP batteries from China for the Chevrolet Bolt while converting production lines toward energy storage. LG Energy Solution has expanded LFP production at its eight North American plants, but most output is destined for stationary storage systems, where LFP chemistry excels in stability and longevity.
This trend raises questions about technological dependence on China. While LFP lowers vehicle costs, it exposes U.S. industry to a supply chain dominated by Beijing. Bob Lee, president of LG Energy Solution North America, emphasizes that the priority is not the return of tax credits but political stability: 'Even with policies that are not friendly, if they are set and stable, you can still invest and plan. Right now, that's difficult.' For consumers, the consequence is that many low-cost EVs on U.S. roads will have Chinese technology under the hood.
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For more on technology adoption trends, see AI for operational excellence is not theory: Italian SMEs risk falling behind and Microsoft launches Microsoft Frontier Company with $2.5 billion for enterprise AI deployment.
Source: https://www.wired.com/story/how-trump-helped-china-make-slate-americas-cheapest-ev
