Everyone is worried about affordability right now, including companies that make cars. Especially companies that make electric cars, which cost an average of $55,000.

That makes America’s newest and cheapest electric truck a welcome, and somewhat strange, addition to the market. Officially unveiled last week, Michigan-based automaker Slate’s small modular offering costs just under $25,000 for its base model, and the base model doesn’t offer much. You’ll have to pay more for everything from power windows to speakers.

But beyond being basic, there’s another hidden feature that allows the Slate to hit a rock-bottom price: a lithium iron phosphate (LFP) battery pack. It is a technology invented in the United States but perfected in China. They are cheaper than traditional nickel-manganese-cobalt (NMC) batteries.

In a quest to make lower-cost electric vehicles, a handful of U.S.-based manufacturers are in Slate’s path, leaning toward less popular chemistry. And in a strange way, the American boom in this particular battery chemistry has China to thank, and also President Donald Trump.

change lanes

Slate did not initially focus on LFP batteries, the InsideEVs website noted last week. The reason was simple: In 2022, Congress passed a sweeping climate law that created a tax credit of up to $7,500 for buyers of new electric vehicles. To qualify for the full credit, manufacturers had to use batteries assembled in the U.S. and, eventually, made from materials from the U.S. and its allies. Crucially, the new rules discouraged the inclusion of materials from Russia, Iran, North Korea and China, all called “foreign entities of interest.”

Manufacturers focused on affordability planned to build vehicles with those restrictions in mind, including the Slate.

These regulations made the use of LFP batteries problematic. American scientists discovered applications for these materials in batteries back in the 1960s. But more than a decade ago, Western and Asian battery makers shifted their focus to other, more energy-dense chemicals. However, Chinese manufacturers decided they were willing to trade the range problems of LFP chemistry for its promise of reducing costs and improving stability.

Since then, Chinese EV giants including BYD and CATL have built a strong supply chain around the chemistry, producing not only LFP cathodes but also the ability to extract, process and manufacture everything else used in batteries. Today, 97.8 percent of LFP cathode production is done in China, according to figures from Benchmark Mineral Intelligence, a London research firm. (Almost 85 percent of all Cathode production also occurs in China).

American automakers began showing interest in the technology even after the tax credit was first announced. Ford, for example, said it would partner with CATL to manufacture LFP batteries in the United States, but the American automaker still had to weigh the cost and performance of the batteries with its eligibility for the tax credit.

Then the rules changed and automakers’ calculations became less complicated. Last summer, the GOP-led Congress made good on an old Trump campaign promise to “end the electric vehicle mandate” by eliminating the tax credit. The move brought electric vehicles back to the United States. Research firm BloombergNEF predicted earlier this month that U.S. sales will fall 19 percent this year due to the policy shift and subsequent decisions automakers made to reduce their production of electric vehicles.

Now automakers have to deal with a confusing and slow electric vehicle market. But they no longer have to worry about the foreign content of their electric vehicle batteries for fear of losing the tax credit. That opened the door for Slate and other companies to take another look at LFPs.