Axios
Biden’s plan to replace the government fleet with electric vehicles will not be so easy
President Biden’s plan to replace the government’s fleet of 650,000 cars and trucks with electric vehicles assembled in the United States by unionized workers is easier said than done. Why it matters: the populist “Buy the American” message sounds good, but the vehicles Biden wants are still several years away and his buying criteria would require an expensive review of automakers’ manufacturing strategies, not to mention a reversal lucky for the organizers of the work that has long been frustrated by Tesla and other non-union companies. Support safe, smart and sensible journalism. Sign up to receive Axios Newsletters here. Reality check: At the moment, no model fits the president’s criteria: battery powered, made in America, by union workers. * Tesla produces the vast majority of EVs in the United States, and all of its models contain at least 55% American parts, according to federal data. But Tesla does not have a union, and CEO Elon Musk has clashed with federal labor laws. * Chevrolet Bolt from General Motors is the only VE made in the United States by unions. But it is mainly made with parts imported from Korea. Only 24% of the content is considered domestic. * The Nissan Leaf, another popular EV, is made in Tennessee. But the factory is not unionized and only 35% of the pieces are domestic. “Made in America” itself is confusing, because the current rules governing “domestic” content include pieces made in the United States and Canada. * According to the American Automobile Labeling Act, approved in 1992, every car requires a label that discloses where the car was assembled, the percentage of equipment in the US and Canada combined, and the country where the engine and transmission were built. * The recently approved US-Mexico-Canada trade agreement adds another layer of rules on the origin of parts. Whence it wants to change the whole system of determining whether a federal vehicle is “American”. * Today, the government requires federal vehicles to have at least 50% of their components manufactured in America, but the gaps allow more valuable parts, such as engines or steel, to be manufactured elsewhere, Biden told reporters Monday. market. * He wants a higher limit and stricter rules that directly benefit American workers. Be smart: anything is possible, but definitely not within Biden’s four-year term. * “It just doesn’t make sense,” said Joe Langley, forecast analyst at IHS Markit. “The product is still a few years away.” * And replacing 650,000 federal vehicles with EVs would require an increase in U.S. investment across the supply chain, including electric motors, batteries and vehicles – all of which will take time, said Langley. * Union leaders are pleased with Biden’s focus on the future of the sector. “He sees new technology as a way to grow our industry and our economy,” a spokesman for United Auto Workers told Axios. Part of this investment is already happening. GM, for example, is renovating several plants to produce electric vehicles in Tennessee and Michigan. Ford will make its next e-Transit van in Missouri. * But GM, Ford and Stellantis (the recently merged FiatChrysler and Peugeot) have recently pledged to build more EVs in union factories in Canada. * And Ford is increasing production of its long-awaited Mustang Mach-E in Mexico. What to watch: There may be some surprise winners from Biden’s plan. * A handful of well-funded EV startups, like Lordstown Motors, Rivian and Workhorse, are developing plug-in commercial vehicles like vans and trucks – things that are often needed in government fleets. * “This can add wind to the sails of many new startups,” said Langley. Be smart: Subscribe for FREE to America’s most influential newsletter.