Rick Haglund: U.S. automakers want help from ‘car guy’ Biden on electric vehicles push

November 14, 2020 8:56 am

President Joe Biden addresses a crowd at a town hall event at Clinton College in Rock Hill, S.C. | Sean Rayford/Getty Images

Corporations and industry groups congratulated President-elect Joe Biden on winning the White House, as is their custom during transitions of power.

But General Motors went a step beyond the typical platitudes and niceties by telling Biden exactly what it’s seeking from Washington:

“We look forward to working with the new administration and incoming Congress on policies that support our customers, dealers and employees, help strengthen our manufacturing presence in the United States and advance our vision of an all-electric, zero-emissions future.”

The key part of that statement is this: GM wants government backing for its monumental effort to convert its entire global manufacturing footprint from building cars and trucks with internal combustion engines to cranking out battery-powered electric vehicles.

Just about every other automaker in the world has a similar goal because of the heavy contribution their gasoline-powered vehicles make to planet-warming greenhouse gases.

GM chief executive Mary Barra has said flat out that “climate change is real, it’s a global concern and the best way to remove automotive ambitions from the environmental equation is an all-electric, zero emissions future.”

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Governments around the world agree and are gradually regulating the internal combustion engine off the road.

California Gov. Gavin Newsom announced in September that the state would ban the sale of gas-powered cars in 2035, just 15 years away. That’s significant because California is the nation’s largest vehicle market and drives automakers’ future product plans.

But don’t worry. The government won’t confiscate your gas-guzzling Dodge Challenger SRT Hellcat.

Automakers also see electric vehicles as a lucrative business opportunity to replace the more than 1 billion mostly fossil fuel-powered cars and trucks roaming the planet. 

U.S. automakers are counting on a Biden administration to help them beat competitors in China, Germany and in other countries that are rapidly developing an electric vehicle industry.

Biden, who in Detroit parlance is a “car guy,” promises to do just that. He’s all-in on electric vehicles, something his predecessor was not.

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While Biden loves his 1967 Corvette, which he once drag-raced against Secretary of State Colin Powell, he has said he can’t wait to drive the 200 mph electric ‘Vette that GM has yet to announce. (It will, no doubt.)

His relationship with automakers isn’t likely to always be as convivial as a Saturday morning “cars and coffee” meetup. But Biden checks a lot of the industry’s policy boxes. 

One of the biggest impediments to broader adoption of electric vehicles is the lack of quick-recharging stations across the country. There are only about 26,000 public charging stations in the United States.

Biden says he’ll work with governors and mayors across the country to build more than 500,000 public highway charging stations by the end of 2030, part of a proposed $400 billion investment in electric vehicle development.

He would spend billions in research to advance battery technology and expand tax credits to purchase electric vehicles. The current $7,500-a-vehicle credit expires for automakers after they have sold 200,000 vehicles.

Those credits have run out for GM and Tesla, U.S. leaders in electric car development.

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Biden also has proposed a “cash-for-clunkers”-type program that would offer rebates to consumers who trade in their gas-powered vehicles for electric ones.

He said his electric vehicle policies would create 1 million auto industry jobs by automakers, suppliers and supporting infrastructure. That’s a highly ambitious goal, more than double the current number of U.S. automaker and parts supplier jobs.

Despite their lovefest over electric cars and trucks, Biden and automakers are unlikely to see eye to eye on all of the president-elect’s policy prescriptions.

President Donald Trump’s 2017 tax cuts, which trimmed the corporate income tax rate from 35% to 21%, were highly popular with auto industry leaders. Biden has said he’ll hike tax rates on big businesses and others, requiring “corporations and the wealthiest Americans to finally pay their fair share.” 

And while Detroit’s automakers have a generally healthy relationship with the United Auto Workers union, Biden’s vow to strengthen the bargaining power of labor unions likely makes industry leaders nervous.

But much of Biden’s electric vehicle agenda depends on getting Congress to appropriate the hundreds of billions of dollars needed to implement it. 

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If Republicans maintain control of the Senate — we won’t know that until the results of runoff elections for Georgia’s two Senate seats in January — Biden’s job gets a lot tougher.

Republicans mostly don’t believe climate change is caused by human behavior.  And they are strong supporters of the oil industry.

Like his beliefs about immigration and low-income housing, Trump has a dystopian view of electric cars. He has bizarrely suggested that clean energy policies might someday restrict families to a single vehicle—a utilitarian electric car with a limited range.

Biden takes the optimistic position that a transition to electric vehicles will create a cleaner environment, a stronger economy and a healthier domestic auto industry.

And by saying he can’t wait to drive an electric Corvette, Biden is speaking to Americans’ long-burning ambition to build something new — and even fun.

That’s refreshing after the past four years of a Trump administration that too often saw technological advancement as an economic threat, not an imperative.

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Rick Haglund
Rick Haglund

Rick Haglund writes the "Micheconomy" column for the Michigan Advance. He's a former reporter and business columnist for Booth Newspapers, now the MLive Media Group, with extensive experience covering Michigan’s economy and the auto industry. He now works as a freelance writer based in Southeast Michigan.