Biden's support for electric vehicles and the U.S. automakers planning to build them may not bode well for the union workers who helped elect him — because the looming transition is likely to cost industry jobs.
(TNS) — President-elect
In remarks Monday, Biden reiterated promises to spend billions to back new clean energy technology, to create as many as a million jobs producing electric vehicles, and to finance new infrastructure supporting them. That includes plans to build out electric charging stations, to invest in development and to give consumers incentives to buy electric.
"Our plan will create good-paying union jobs, in manufacturing, building the vehicles, products, technologies that we're going to need for the future to compete with the rest of the world," he said after a virtual meeting with business and labor leaders that included
But automakers' anticipation of investment and stability in
Biden's tone and focus on policy and partnership struck a markedly different chord from the current administration, and likely will be welcomed by many in the auto industry, said Sam Abuelsamid, principal analyst at Guidehouse Insights: "I think he will be perceived largely with a sigh of relief."
Still, concerns loom. Despite new jobs in software development and battery assembly replacing imperiled jobs in traditional manufacturing, analysts and industry insiders say it's likely the transition to EVs will deliver a net job loss — even as Biden and others in the progressive wing of his party have touted the potential for millions of new jobs tied to clean energy.
Evidence of the coming shift is mounting. On Monday, Groupe PSA CEO
"The point is ... how much time you give the industry to adapt to this situation and how much time you give the industry to train people to different jobs or readjust their company to this different reality," Tavares said.
Yet it remains unclear how, and whether, consumer appetite for electric vehicles will strengthen enough to justify spending for the added infrastructure. To date, buyers are demonstrating a clear and growing preference for trucks and SUVs powered by the lowest-priced gasoline in years.
Currently, fully electric vehicles make up less than 2% of
Despite that tiny share of sales, and despite President
A major reason is that they anticipate EVs will be the future of the industry as they work to keep pace with global rivals in
"We're committed to growing the EV market and it's critical to have all key stakeholders at the table — including federal and state policymakers, automakers, labor, environmental groups, auto suppliers and dealers,"
Investments in production, infrastructure
Like many automakers, Biden has his eye on
That includes compelling governments to buy electric vehicles for federal, state and local needs, and creating "significant new targeted incentives" for automakers to transform factories to build electric vehicles. This is part of a plan to spend $400 billion in federal funds to transition the country to clean energy systems.
He's said he would spend an additional $300 billion on research and development and emerging technology, one silo of which will be electric vehicles. All those new electric cars, of course, need a way to consistently stay charged outside of the home in order for people to feel confident buying them.
According to the
It's been a big concern for industry leaders, and Biden spoke to that anxiety at a rally in
In order for widespread EV adoption to be successful, experts agree on the need for a major upgrade to the country's electric infrastructure — a proposition that the UAW and others have described as an opportunity to create new jobs.
"Besides the tax credits, I think where the (Biden) administration can provide the biggest boost to electrification is more investment in the charging infrastructure," said Abuelsamid. "Making charging more accessible to people who rely on street parking, or live in apartments, or things like that — those sorts of moves would also be very beneficial."
Encourage consumers to buy electric
Biden has said he would put more money into that program, which would be a boon to companies like
Still, electric vehicle sales make up just a tiny portion of overall sales nationwide. But
"(Automakers) face the reality of, if they want to compete in
"The auto companies are fairly aligned with the lower carbon future. They've been developing all forms of electrification," from hybrids to fuel cells they plan to roll out in the coming years, Dziczek said. "Having supportive policies at the federal level will be helpful to those plans."
Create 1 million new jobs?
The shift away from gas-powered vehicles has some experts, politicians, industry executives and labor leaders nervous about another wave of dramatic job losses little more than a decade after the Great Recession decimated an already-fragile industry.
Electric vehicles, by some estimates, require as few as half as many parts as gas-consuming cars and take around one-third less time to build. They require less maintenance and are more easily assembled using automated processes. All of these changes could mean fewer jobs in factories, dealerships, engineering firms and more.
However, the shift to EVs will eventually create new jobs in fields such as battery assembly, software engineering and more. The industry finds itself squarely in the center of that shift, and it's unclear how it will pan out for both hourly workers and technical salaried employees.
Biden pledges his plans won't further cut into the industry and instead would create a million new jobs across the industry between suppliers, manufacturers and building the infrastructure necessary to support expansion.
But experts say that's not entirely realistic. The industry currently has around 2.8 million jobs (913,000 in manufacturing and 1.9 million in sales) — adding another million would grow the industry by nearly a third. It's unclear exactly what the net job growth or loss will be from the transition to EVs, but it's clear that electric vehicles will disrupt the industry's workforce.
"I don't expect (auto) sales to explode in the coming four years, so I would be skeptical" of Biden's jobs claims, said Abuelsamid. "And with the shift to electrification, there's going to be some loss of traditional jobs."
"There will be fewer jobs in the plants because frankly it takes fewer workers," Dingell said. "But we need to build batteries here. We will replace jobs that will be lost with green jobs. I'm trying to get everybody at the table so we can find policies that accomplish where we need to go and also protect jobs."
It's an issue on which the UAW has been sounding the alarm. "The auto industry is facing a new shift in technology with the proliferation of electric vehicles," a recent report on EVs by the union says. "This shift is an opportunity to re-invest in
But, it warns: "This opportunity will be lost if EVs or their components are imported or made by low-road suppliers who underpay workers." To prevent this, the union is advocating for a "proactive industrial policy that creates high-quality manufacturing making EVs and their components," including a "comprehensive EV policy that supports consumer purchases and ensures that the EV manufacturing supply chain is in the
The union has called for, among those things, investments in EV infrastructure, training for displaced workers, government incentives that promote domestic production of EVs and EV components, a government procurement commitment, and additional consumer incentives — many of the policies Biden has touted.
The auto industry will look to the Biden administration for a more stable tone and approach to policy, experts say. The Trump years were characterized by erratic messaging, episodic tariff threats, rollbacks of fuel economy standards the automakers didn't seek, and the president at times lashing out at individual companies and executives via Twitter.
"When you're spending billions of dollars on product programs," said Abuelsamid, "one thing you want more than anything else is stability."
Abuelsamid says a regulatory framework to guide the auto industry's other big bet — self-driving vehicles — is also much needed: "Now's the time when they need to be having those conversations to understand how you go about setting those standards. ... The industry is going to be looking to
(c)2020 The Detroit News. Distributed by Tribune Content Agency, LLC.
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