From Georgia to Arizona and from Michigan to Texas, a long-overdue resurgence is taking hold in American manufacturing. In towns where industrial jobs were once written off as relics of the past, new facilities are breaking ground, well-paid jobs are opening, and domestic production is reasserting itself as a cornerstone of national strength. This progress is real, and it is not happening by chance.
One policy has quietly become an important element of this revival: the 45X advanced manufacturing tax credit. Created by the Inflation Reduction Act of 2022, the 45X credit is a straightforward, production-based incentive that rewards companies for manufacturing energy components in the United States. It covers items like solar-related manufacturing, battery production, and critical minerals.
At its core, 45X reflects a simple principle: if the U.S. wants to lead the world in advanced manufacturing, it must make things here at home. For decades, American companies faced overwhelming pressure to offshore production in pursuit of lower costs. The result was an economy increasingly dependent on foreign suppliers—often adversarial nations like China—for vital components and materials. The 45X tax credit reverses that trend by reducing the cost disadvantage of domestic production, which gives American manufacturers and their families a fighting chance.
U.S.-based companies are building battery plants and solar manufacturing facilities in both urban and rural communities. The credit has helped unlock more than $90 billion in private sector investment, which translates to jobs, supply chain security, and long-term economic competitiveness. President Trump wants to put American families and manufacturing jobs first, and 45x does just that.
The credit is only triggered when qualifying products are manufactured and sold. It rewards output, not projections. The structure encourages scale, innovation, and efficiency while maintaining rigorous oversight. Because of 45X, advanced manufacturing will continue to power President Trump’s golden age of American energy dominance.
The national security rationale for the tax credit also is compelling. The U.S. has been dangerously reliant on China for critical minerals and energy components. China controls more than 90 percent of global rare earth processing and dominates the production of batteries and solar components. If the U.S. fails to build independent capacity, it risks being caught flat-footed if geopolitical tension disrupts supply chains.
45X doesn’t favor individual companies or pick winners. It supports entire sectors. It is a counterbalance to decades of foreign-state subsidies for overseas competitors. Pulling it back now would undercut President Trump’s trade and manufacturing agenda and would hand the advantage back to America’s competitors.
Weakening or repealing 45X would stall a promising manufacturing recovery and signal that the U.S. lacks the will to rebuild its economic foundations.
The opportunity is in front of us to deliver a big win for America’s hardworking families. Let’s not waste it.
Thomas Hochman is the Director of Infrastructure policy at the Foundation for American Innovation.
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