Biden Restates EV Commitment

“China now produces more steel in one month than America does in an entire year,” Biden said on October 5. “You can see it in the sector after sector: Other countries are speeding up and America is falling behind. We’ve got to reset the pace again. We’ve got to set a different pace. For example, here in Michigan, we need to make sure that American autoworkers lead the world in electric vehicles.”

The auto industry is of paramount importance to Michigan. The state is home to 19% of all U.S. auto production and to the headquarters of the major American carmakers.

> Read more about U.S. EV policy here.

General Motors announced earlier this year that it would phase out petroleum-powered cars and trucks and sell only EVs by 2035. Ford committed to converting 40% of its global vehicle sales to EVs by 2030, with 100% of its European passenger car sales electrified by that date. Stellantis, which owns the brands Chrysler, Dodge, Jeep, Ram, Alfa Romeo, Peugeot and Fiat, is aiming for 70% of sales in Europe and more than 40% in the U.S. to be low-emission vehicles by 2030.

“They decided they’re going to lead the world and they’re going to build more of the electric vehicles than any other country,” Biden said of the automakers. “But guess what? China is not waiting around. They’ve manufactured more than twice as many electric vehicles as we have over the last decade. They control more than 75 percent of the battery market. And they’re poised to invest another $14 billion in charging capacity now in their country.”

Biden acknowledged that the entire world is viewing EVs as the way forward for the auto industry.

“We need to make sure America builds that future instead of falling behind,” he said. “We should build those vehicles, and the batteries to get them, here in the United States of America. That’s what we should build here in the state of Michigan. I want those jobs here in Michigan, not halfway around the globe.”

He added that economic development will flourish around charging stations and jobs will be available with battery manufacturers, which he hopes will be based in the U.S.

In one of the most recent signs of increasing demand for EVs, the Hertz car rental company announced on Monday that it intends to convert more than 20% of its fleet to Tesla electric vehicles by the end of 2022. Hertz is placing its order for 100,000 Teslas just as it is emerging from bankruptcy. Tesla’s stock soared by nearly 13% after the announcement.

The president showed his willingness to put the pedal to the metal on EVs. In May, he test drove a Ford F-150 electric pickup and was pictured driving an electric Jeep Wrangler Rubicon around the White House ellipse during the electric vehicle summit in August. He also signed an executive order at the summit stating that EVs would constitute 50% of all new vehicles sold in the U.S. by 2030.

“As I’ve said before, we’re in competition with China and many other nations for the 21st century,” Biden said in August. “To win, we’re going to have to make sure the future will be made in America.”

But Biden should look past the big three legacy automakers Ford, GM and Chrysler Stellantis North America, and concentrate on companies that are already outdoing the Chinese, thinks Nick Augusteijn, an automotive journalist.

“Tesla was snubbed at the president’s electric vehicle summit, despite being the world’s number one BEV maker and having six times the market capitalization of Ford and GM combined,” Augusteijn told Electric Vehicles InSite. “New vehicles by promising startups Rivian and Lucid Motors are just around the corner. They might end up driving America forward, not Chrysler, Cadillac or Dodge.”  

Biden also emphasized that battery production will be a big part of the effort. “The question is whether we’ll lead or fall behind in the race for the future,” Biden said. “It’s whether we’ll build these vehicles and the batteries that got them to where they are in the United States — here in the United States, or we’re going to have to rely on other countries for those batteries.”

According to data gathered by the U.S. Office of Energy Efficiency and Renewable Energy, America lags far behind China and the European Union when it comes to projected installed capacity. That will remain so in the current decade.

“Localising production is a no brainer. It means investment and jobs. It makes little sense to churn out hundreds of thousands of battery electric vehicles and then have to wait for the battery cells to be shipped in from abroad,” Augusteijn said.

Over time, widescale conversion to EVs is bound to change the lubricants industry. “At a high level, EVs will slowly impact engine oil demand and will limit growth in the near term globally,” lubricant consultant Steven Haffner said via email. “North America and Northern and Western Europe are already seeing flat demand or slightly declining demand. Longer term that will apply globally.”

He added that the speed at which conversion to EVs occurs will be impacted in a large way by government mandates and incentives, as well as the price of fuel and the cost of a new EV.

Addressing the U.N. General Assembly in September, Biden cited the benefits that EVs have for the world, saying: “My administration is working closely with our Congress to make the critical investments in green infrastructure and electric vehicles that will help us lock in progress at home toward our climate goals. And the best part is: Making these ambitious investments isn’t just good climate policy, it’s a chance for each of our countries to invest in ourselves and our own future. It’s an enormous opportunity to create good-paying jobs for workers in each of our countries and to spur long-term economic growth that will improve the quality of life for all of our people.”