Source: Blog – Alliance for American Manufacturing

While the United States is beginning the transition to electric vehicles, countries like China already are laps ahead making these next generation of cars, trucks and SUVs. It’s time for the U.S. to get into the race. Getty Images

Biden announced a goal that 50% of new U.S. vehicle sales by 2030 will be zero emission. The key will be making sure all those vehicles are American-made.

President Biden issued an executive order on Thursday that sets a target that at least half of all cars, trucks and SUVs sold in the U.S.by 2030 will be zero emission vehicles.

Biden’s order was the product of months-long negotiations between labor, manufacturing, and environmental groups, and the president was joined by a diverse array of leaders lending their support during an address at the White House announcing the initiative on Thursday afternoon.

This is a big deal in the fight to lower emissions and combat climate change. But while it is important to transition consumer purchases from gas guzzlers to electric vehicles (EVs), it’s just as vital that the administration and Congress work together to ensure that the United States does not fall behind in the race to actually make these eco-friendly vehicles.

The president framed it perfectly himself: “We’re in a competition with China — to win we need to ensure that the future is made in America.”

Alliance for American Manufacturing President Scott Paul echoed those thoughts in a statement, stressing that “It’s not enough to set purchasing targets. We also need to make serious investments to ensure that these vehicles, related supply chains and the infrastructure needed to support them are manufactured in America, too.”

Specifically, the executive order directs government agencies like the Environmental Protection Agency (EPA) and Department of Transportation to reverse rollbacks on fuel efficiency and emissions standards, in order to bring the whole country in line with an emissions framework set by the state of California. According to a fact sheet put out by the Biden administration, these new rules would deliver $140 billion in net benefits over their lifetime, and give every American a net fuel savings of up to $900 over their vehicle’s lifetime.

This fits into an optimistic future for EVs, which is bolstered by commitments by the largest automakers in the country. Ford, General Motors and Chrysler Stellantis – the Big Three Automakers – voiced support for the Biden order, and announced a joint pledge to achieve sales of 40-50% electric vehicles in the US by 2030, a major step up from where EV sales currently stand at just 2 percent.

Given the coordination between policy and the private sector, there seems to be an inevitability around EVs overtaking gas-powered cars. Now the question is simply where they will be made.

As it stands, the U.S. is locked in a race to ensure that EVs are built here, guaranteeing that the jobs they will provide go to American workers, particularly those in communities dependent on the auto industry for jobs.

But unfortunately, right now the United States is far behind.

The leader in this race for EV dominance is China, which has used unfair state intervention and other illicit tactics like intellectual property theft to grow its EV industry. In fact, China is setting up more EV factories than the rest of the world combined.

And while many have pointed out that auto manufacturing isn’t a zero-sum game, it’s not one that the U.S. can afford to lose, either. If auto manufacturing disappears from the United States instead of shifting to producing EVs – which is a possibility, as the loss of other critical industries has shown us —  millions of Americans will lose good-paying (and often unionized) jobs, and economic depression will ripple throughout the auto supply chain in America. Anything less than a major investment in American EV production now will result in an economic catastrophe in the very near future.

“We need automakers and other companies to invest in America…continue to pay good wages, and support local communities across the country,” Biden said. “It’s why I’m proud that the three largest [auto] employers are here and their sights are set, not just on electric vehicles, but on expansion.”

Commitments from only automakers will not be enough, however. The United States also desperately needs new investment downstream in the auto supply chain, particularly in producing batteries and semiconductors. Both of these components are essential to EVs, and both industries are dominated by China, where forced labor and environmentally unsustainable practices dominate their production.

Semiconductors are especially important, given that automakers are already suffering billions in lost production and sales due in part to a lack of U.S. production capacity. To ensure that we can build EVs in America, we need to beef up production.

In all, there’s a lot more investment needed to ensure that the U.S. is positioned to lead the EV manufacturing race, but it’s still worth emphasizing that Biden’s executive order today to quicken the market’s embrace of EVs is a good start.

And if the President and Congress can follow through on the rest of their goals for EV manufacturing — **cough** the Bipartisan Infrastructure Deal and the US Innovation and Competition Act **cough** — we’ll take further strides to provide good manufacturing jobs and to ensure that electric vehicles are Made in America.

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