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GM Asks Treasury to Classify its Cadillac Lyriq as an SUV

Without an SUV classification, the Cadillac Lyriq exceeds the price threshold for federal tax credits for EVs.

January 9, 2023
GM Asks Treasury to Classify its Cadillac Lyriq as an SUV

Without an SUV classification, the Cadillac Lyriq exceeds the price threshold for federal tax credits for EVs.

IMAGE: Cadillac

2 min to read


Currently, GM's electric Cadillac Lyriq does not qualify for federal tax credits. General Motors wants to see that changed.

The Detroit automaker has asked the U.S. Treasury to reconsider classification of the EV to allow it to qualify for federal tax credits.

Because the Treasury and Internal Revenue Service did not classify the Lyriq as an SUV, its retail price cannot be above $55,000 to qualify for up to $7,500 in federal tax credits. The Lyriq currently retails at a base price of $62,990.

SUVs priced at up to $80,000 can qualify for tax credits, while cars, sedans and wagons cannot not be priced higher than $55,000.

"We are addressing these concerns with Treasury and hope that forthcoming guidance on vehicle classifications will provide the needed clarity to consumers and dealers, as well as regulators and manufacturers," GM told Reuters Friday.

GM recommends the Treasury adopt criteria and processes similar to those used by the Environmental Protection Agency and Energy Department for “consistency across existing federal policy and clarity for consumers."

A Treasury spokesperson reported the agency used pre-existing and long-standing EPA fuel economy standards, which “offer clear criteria for delineating between cars and SUVs."

Tesla Chief Executive Elon Musk tweeted last week that  the EV tax rules were "messed up." Tesla’s five-seat version of the Tesla Model Y is not considered an SUV, while its Model Y seven-seat version is and thus qualifies for the credit.

The Volkswagen ID.4 is not classified as an SUV, while its all-wheel drive version is, according to the IRS.

The Treasury has delayed releasing proposed guidance on required sourcing of EV batteries until March, giving a brief window of eligibility for the full $7,500 tax credit for some EVs before the new sourcing rules take effect.

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