No EV Tax Credits This Fall?, Rare Earth Workarounds, Small Biz Gets Scammed

Automotive State of The Union

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Episode #1084: Today we unpack the Senate’s plan to fast-track the end of EV tax credits, the global rush to secure rare earth magnet supply, and how small business owners are battling a new wave of AI-powered scams.

Show Notes with links:

• Congress is fast-tracking the elimination of federal EV tax credits, creating waves across the auto retail and manufacturing sectors. A new Senate bill proposes ending both new and used EV credits by September 30, 2025.
  • The Senate plan accelerates the credit phaseout, bypassing both House and prior Senate timelines.
  • Lucid’s CEO warns the change “would make it very difficult for new players in the market.”
  • The bill also ends penalties for CAFE standard noncompliance, easing burdens on legacy automakers.
  • Dealers are concerned; roughly 140,000 EVs sit on lots.
  • NADA:“If EV tax credits are going to be repealed, NADA urges Congress to include a reasonable transition period.”

• China’s latest export restrictions have flipped the rare earths market on its head—sending automakers scrambling for alternatives and giving non-China suppliers the spotlight.
  • After Beijing tightened exports of key magnet materials in April, Western buyers are now urgently securing non-Chinese supply chains.
  • Neo Performance Materials in Estonia has seen surging demand at a $10–$30/kg premium for non-China magnets.
  • Korean and European firms are also investing in alternative sources, even paying 15–30% more to ensure supply.
  • Industry insiders warn that premiums too high could kill demand; too low, and new suppliers can’t survive.
  • “Customers understand there is a premium… but if that premium gets too big, we’re looking at demand destruction,” said Neo CEO Rahim Suleman.

• Small business owners are facing an alarming new wave of fraud—fueled by generative AI. With tools like ChatGPT and deepfake video tech, scammers can now clone brands, replicate storefronts, and impersonate real people—all with little to no technical skill.
  • One scam targeted knife seller Oishya with a fake giveaway campaign, sending fraudulent offers to 10,000 Instagram followers and duping nearly 100 customers out of shipping fees.
  • A recruiter shared how applicants now use AI avatars to cheat video calls, forcing her to ask for ID and personal questions to confirm they’re real.
  • In another case, an engineering firm lost $25 million after an employee was tricked by AI-generated video replicas of his coworkers, including the CFO.
  • “It’s like whack-a-mole, but the moles are multiplying,” said one cybersecurity executive.
  • “Doing business online gets more necessary and high risk every year,” said Nima Etemadi of Cake Life Shop. “AI is just part of that.”

Join Paul J Daly and Kyle Mountsier every morning for the Automotive State of the Union podcast as they connect the dots across car dealerships, retail trends, emerging tech like AI, and cultural shifts—bringing clarity, speed, and people-first insight to automotive leaders navigating a rapidly changing industry.
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