EU: US electric vehicle tax credit reduces buyers' choices

A new U.S. tax credit aimed at encouraging Americans to buy electric vehicles may backfire and limit choices for consumers because of concerns it's weighed against European Union manufacturers, the EU trade chief said Thursday.

Valdis Dombrovskis held a virtual meeting with his American counterpart Katherine Tai to address a wide range of trade issues, including the tax credit provision.

Democrats included the credit in the climate and health care policy law passed last month as a way to incentivize domestic battery and electric vehicle production. But manufacturers in Europe and South Korea, which sell millions of vehicles in the U.S., have threatened to lodge legal complaints with the World Trade Organization.