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[Conor Sen] EVs complicate GOP messageBy Korea Herald
Published : June 20, 2023 - 05:31
It’s still very early days, but if you're wondering how the 2024 presidential campaign might be different from the last matchup between Joe Biden and Donald Trump, one place to start is electric vehicles. Battery-powered cars are one of the biggest economic vulnerabilities that Republicans have in the battleground states such as Georgia, Michigan and Arizona that could wind up deciding the winner.
The growth of electric vehicles is unique in that it touches an area of the US economy that has changed dramatically since the last presidential election. They're a key part of the Biden administration's policy accomplishments, and they’re also entangled in the culture wars that animate the bases of both political parties.
EV sales in the US are growing so quickly that you could even describe the shift as monumental. In 2020, 325,000 EVs were sold in the US, accounting for 2.4 percent of all passenger vehicle sales. Those numbers are projected to rise in 2024 to almost 2.5 million vehicles, or 17.0 percent of all sales, according to BloombergNEF's Electric Vehicle Outlook report published last week. That would be more EV's sold in a year than the 1.8 million vehicles Toyota Motor Corp. sold in the US in 2022. EV's are no longer a niche.
That’s generating a massive flow of investment in EV production, battery plants and supply chains -- and much of that investment is pouring into states that are likely to be pivotal in the next presidential election. Between the passage of the Inflation Reduction Act in August 2022 and May 2023, $70 billion of investments were announced in the EV supply chain, with battleground states Georgia, Michigan, Arizona, Nevada and North Carolina each getting billions of dollars in projects. Here in Georgia, Rivian Automotive Inc. (east of Atlanta) and Hyundai Motor Co. (outside of Savannah) are in the process of building EV production facilities, each of which will be capable of producing hundreds of thousands of vehicles annually.
Over the next 16 months, Biden will likely be doing hard-hat tours and ribbon cuttings at facilities like these, touting them as outcomes made possible by the legislation he signed, and fulfilling campaign promises to bring manufacturing jobs back to America. Politics being what it is, if Democrats are touting something, it's no surprise that Republicans are being critical. Yet, it was still jarring to hear Trump say in Georgia in recent days that he'd scrap support for EV's on his "first day in office" should he win the election.
So now we have EV’s emerging as a party purity test for the GOP. Will Trump’s rivals for the nomination fall in line with him on this, too? How can they oppose an industry that’s shaping up to be a major economic engine, providing good-paying jobs to many of their voters and spurring growth? As governor of Florida, Ron DeSantis has awarded money for electric transit buses and talked about "the state's efforts to bolster growing electric vehicle usage." Yet Florida hasn’t attracted the kind of high-profile EV supply chain investments that other states have. As a presidential candidate, embracing EVs might go against the brand DeSantis has cultivated as a conservative warrior against progressive America.
There's also no clear path for rolling back all the investments already being made by the Biden administration and auto manufacturers to increase EV production and sales. There's no "repeal Obamacare" button to push. Automakers that are committing tens of billions of dollars to shift production to EV's aren't going to change their minds based on the outcome of a presidential election, and investors -- who value EV adoption timelines more than present-day gasoline-powered profits -- would revolt.
Additionally, with both political parties concerned about China's growing clout in manufacturing and technology, being anti-EV would amount to surrendering the future of the automobile industry to China. China surpassed Japan to become the world's largest exporter of automobiles in the first quarter, and China's BYD Co. is competing with Tesla Inc. to become the most important EV company. Also, China already dominates the EV battery supply chain.
Trump's outsized persona and legal troubles are dominating the conversation in the Republican presidential primary for now, and understandably so. But the investments made by the Biden administration, the growth of electric vehicles, and the position of the US versus China in the EV arms race is a crucial topic that touches on both the economy and geopolitics, and will matter in the states that decide the presidential election. Trump or no Trump, Republicans need to figure out a message on the issue.
Conor Sen is a Bloomberg Opinion columnist. -- Ed.
(Tribune Content Agency)
Articles by Korea Herald
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