Biden charts an electrified course for the auto industry
President Biden pulled a U-turn for the auto industry with a focus on EVs and stricter emissions standards. We take a look at what's happened thus far.
President Biden's tenure in office thus far has brought about enormous change for the auto industry -- perhaps some of the biggest changes in decades. Although the pandemic has been the new administration's top priority, these 100-plus days charted an EV-focused auto industry through a federal focus on climate change, emissions standards and budding Chinese competitiveness, and potential dominance, in future technologies and raw materials.
The Biden administration's actions so far, detailed below, may not be permanent in every respect, or even made into law, but the 46th president's first 100 days undeniably helped recalculate the auto industry well into the next decade.
An electric federal fleet
On Jan. 25, Biden announced an executive order that will convert the US government's 645,000-strong fleet of vehicles to battery-powered vehicles. With a core focus on reducing emissions and setting an example for the country to shift to EVs, the EO also aims to bolster the US' purchasing power to buy EVs from American businesses and US-made products. The administration hasn't produced a timeline for the conversion just yet, and the next-generation mail delivery trucks have already challenged how serious the administration is with this commitment.
EV tax credit renewal nabs attention
In the earliest days of the Biden administration, and the Democrats' newfound control of both chambers of Congress, Democratic senators reintroduced the GREEN Act, which includes restored federal tax credits for automakers and those who buy EVs. If passed, it would provide up to $7,000 for EV buyers to take advantage of when filing their taxes the following year and give automakers a new credit ceiling of 600,000 vehicles. Tesla and GM are the only automakers no longer eligible to pass on tax credits to EV buyers, as they reached the limit in 2019 and 2020, respectively. Passing the bill under the Democratic-led chambers, and Biden, may prove much easier, hence its reintroduction. However, it may not live on following news of the president's infrastructure plan.
$100 billion for direct EV rebates
Under the president's proposed $2.25 trillion infrastructure plan, the federal government would make $100 billion available for EV rebates at the point of sale. In other words, the federal government, under Biden, may directly subsidize the purchase of an electric car. Rather than a tax credit to claim a year later, this proposal would take cash off an EV's sticker price right at the dealership. It's not clear how much an individual or household may receive, should the proposal make its way into a passed law, but the move could drastically alter EV adoption here in the US.
500,000 new charging stations could be coming to America under Biden.
Half a million EV chargers
Also included in Biden's ambitious infrastructure plan is the proposal of 500,000 new EV charging stations across the US. The plan calls for every one of these half a million chargers to be installed by 2030, providing funds for grants and incentive programs for state and local governments, as well as private companies.
Revamped fuel economy and emissions regulations
By this July, the Biden administration will reveal updated fuel economy and emissions regulations for automakers to adhere to, and they will do the exact opposite of the Trump administration's efforts, which reduced annual improvements substantially. Automakers don't just work for the present; product planning stretches years ahead, so it will be tough for any future administration to make steep reversals to whatever figures the Biden administration presents. How strict will the new regulations be? EPA Administrator Michael Regan believes they need to meet the urgency of the climate crisis.
Reversing Trump's ban on California setting standards
More recently, both the EPA and Department of Transportation under Biden moved to withdraw a 2019 rule from the Trump administration that would restore California's right to set state-level emissions standards and zero-emission vehicle mandates. The latter ability has long been a thorn in automakers' sides, essentially creating two sets of standards for companies to follow: California and federal regulations. Under Biden, the state may soon get this ability back, but this time, the majority of automakers appear to be on California's side, unlike the last time.
Remaking America's EV supply chain
A Biden-ordered review of the US' supply chain for semiconductor chips didn't stop there. Included in a short- and long-term review of the country's supply chain is a closer investigation of the US' rare earth materials and how the country can better position itself to counter China's EV supply chain, specifically, batteries. The order's scope extends to "advanced batteries, like the ones used in electric vehicles," with a goal of bolstering the US supply chain to keep issues like the semiconductor shortage from ever becoming as serious in the first place. The president's infrastructure bill would also make billions of dollars available for companies to retool their plants to pivot and support EV production, plus battery assembly domestically.
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