WASHINGTON – President Joe Biden, a gearhead with his own vintage Corvette, will showcase his administration’s efforts to promote electric vehicles during a visit to the Detroit Auto Show.
The president, who recently took a spin in his pine-green 1967 Stingray with Jay Leno for CNBC’s “Jay Leno’s Garage,” may get a chance to get behind the wheel of the new car Wednesday during a stop in Detroit. He doesn’t stand much of a chance in the driver’s seat anymore; he is not allowed to drive on public roads as president.
But he’s mainly going to the North American International Auto Show to talk about a huge new climate, tax and health care bill that offers tax credits for buying electric cars.
While Biden took credit for the recent boom in battery and electric vehicle assembly plants, most of them were in the works long before the inflation-reducing legislation was signed into law on August 16. Biden’s Infrastructure Act of 2021 could have something to do with it, providing $5 billion over five years to help states build a network of charging stations for electric vehicles.
Under the latest law, electric vehicles must be manufactured in North America to qualify for a new federal tax credit of up to $7,500. Batteries for qualifying vehicles must also be manufactured in North America, and there are mineral requirements for batteries that must be manufactured or processed on the continent. The loans are aimed at creating an American electric vehicle supply chain and ending dependence on other countries, mainly China.
The measure sparked a scramble by automakers to speed up efforts to source North American-made batteries and battery minerals from the U.S., Canada or Mexico to ensure electric vehicles qualify for the credit.
In April, Ford began producing electric pickup trucks at a new plant in Michigan. General Motors has converted an old factory in Detroit to produce electric Hummers and pickup trucks.
Long before lawmakers reached a compromise on the legislation, each company announced plans to build three plants to produce electric vehicle batteries, all joint ventures with battery makers. GM’s battery plant in Warren, Ohio has already started production. The government loan, announced in July, will help GM build its battery plants.
Ford said last September that it would build the next generation of electric pickup trucks at a plant in Tennessee, and GM announced electric vehicle assembly plants in Lansing, Michigan; Spring Hill, Tennessee; and Orion Township, Michigan. In May, Stellantis, formerly Fiat Chrysler, said it would build another joint venture battery factory in Indiana and announced the opening of a battery plant in Canada.
Hyundai announced construction of battery and assembly plants in May in Georgia, and Vietnamese automaker VinFast announced the opening of plants in North Carolina in July. Honda and Toyota announced production of batteries in the U.S. after the law passed, but they were months in the making.
Biden has long talked about the importance of creating a domestic supply chain for electric vehicles, and that may have prompted some companies to locate factories in the US. But it’s also advantageous to build batteries near the places where electric vehicles will be assembled, because batteries are heavy and expensive to ship from abroad.
And car companies are rolling out more affordable electric options, even with the cost of batteries. The latest arrived last week from General Motors, the Chevrolet Equinox small SUV. It starts at about $30,000 and has a range of 250 miles, or 400 kilometers, on a single charge. Buyers can get 300 miles or 500 kilometers of range if they pay more.
Equinox checks the North American assembly box. It will be made in Mexico. The company did not say where the battery will be manufactured, but is working to meet other criteria for the tax credit.
Krisher reported from Detroit.
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