President Joe Biden’s plan to cut U.S. emissions dramatically relies on more Americans to buy electric vehicles, which is why the administration wanted to include massive subsidies for Americans to buy them.
At the same time, American manufacturers can’t build electric vehicles fast enough for the people who want to buy them, with waitlists on some models stretching over a year. How do you reconcile throwing government money at people who are already buying enough of a product for which demand far outstrips supply?
If you’re Transportation Secretary Pete Buttigieg, you don’t.
In a particularly brutal portion of Buttigieg’s Thursday testimony before the Senate Appropriations Committee, the transportation secretary didn’t respond to West Virginia Democrat Sen. Joe Manchin’s questions about why the Biden administration wanted to give EV purchasers huge tax breaks to buy what they’d already be buying.
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Tax breaks for EV buyers had been a major part of Biden’s abortive Build Back Better Act, with tax incentives of up to $12,500, according to CNBC. While that massive omnibus package failed — thanks mostly to Manchin, who refused to support it — there had been hope of revisiting it.
A senior adviser for Oregon Democrat Sen. Ron Wyden, the Senate Finance Committee chair who helped lead the charge to pass Build Back Better, said last month that Russia’s invasion of Ukraine was “spurring additional desire” to pass the energy provisions in the original bill, according to E&E News.
“We’re still extremely optimistic about the path forward for passing this package, and in preserving the bulk of what we had in December,” Bobby Andres said at a March forum. “The opportune time to take action is likely in the next month or two.”
That, of course, relies on Manchin’s vote. I don’t know if Andres would describe himself as “extremely optimistic” after Thursday’s hearing, where Manchin derided the idea of providing subsidies for EV buyers.
Does the U.S. need to be subsidizing electric cars?
Yes: 0% (0 Votes)
No: 100% (7 Votes)
“There’s a waiting list for EVs right now with the fuel price at $4,” Manchin told Buttigieg. “But they still want us to throw $5,000, or $7,000, or $12,000 credit to buy an electric vehicle.”
“It makes no sense to me whatsoever when supply and demand — we can’t produce the product for the people who want it and we’re still going to pay them to take it? It’s absolutely ludicrous in my mind,” he continued.
“But I’m thinking we are getting ourselves tangled in a situation that we’re not going to be able to supply — electrodes and anodes and cathodes — everything that’s going to be needed for this product,” he added, referring to concerns that much of the supply for critical EV materials runs through China.
He then asked Buttigieg if he shared his concerns. Buttigieg’s answer: He shared about half of them, and the other half (namely, the credits) he wasn’t going to be talking about.
“We are following this closely and I think it’s a great example of one of the areas of manufacturing capacity that we’ve got to do more of right here on American soil,” Buttigieg said.
“If you look at the timelines that the physicists have laid out on climate, some of them can — in terms of our action and our need to rise to the challenge — could arguably be measured in months rather than years at this point.
“So, we feel a sense of enormous urgency to accelerate not just the uptake of electric vehicles, but, as you note, their production and our productive capacity for them,” he added.
Yes, but in terms of the ability to produce EVs for consumers who want them, the timeline that automakers have laid out on delivery is inarguably measured in years rather than months at this point.
“Electric car buyers are facing longer than normal waiting times for a couple of key reasons – demand and supply. In some cases there is a perfect storm of increased demand with restricted supply, which is causing year-long waiting lists for comparatively humble models like the Volkswagen ID.3,” EV-centric publication Electrifying reported in March.
While some of this is attributable to the usual supply-chain constraints, much of it is demand: “Kia, for example, says it is not experiencing delays in production and is actually delivering the cars it was supposed to, but huge demand for models like the EV6 means the queue to get one is now up to 10 months long,” they reported.
That’s not just because of gas prices — although expect those to stay high for as long as Joe Biden is in the White House, since his administration only seems to give a rip about them now because inflation is going to be one of the primary reasons Democrats will likely be destroyed in this November’s midterms.
EVs are suddenly, well, cool. They’re not just considered cool because of the left’s nauseating drum-beat on alternative energy; the technology has evolved to the point where they can outperform traditional internal combustion automobiles for certain people. Tesla’s cars, in particular, have a certain je ne sais quois about them: an ineffable combination of an Alfa Romeo, a cool new tech gadget and a spaceship, all rolled into one. (The company’s CEO definitely doesn’t hurt the cool factor, either.)
However, when you have so much demand that there are waiting lists that stretch over a year, in some cases, why throw money at people to buy EVs when they’re already buying them faster than they’re being produced?
Secretary Buttigieg didn’t answer that question, and I doubt too many in the Biden administration are going to jump in to help him, either. One suspects that’s because it’s the default answer the Biden administration has for almost any problem: If you throw money at it, it’ll get fixed. Somehow.
Judging by Manchin’s questioning on Thursday, however — in which he called the tax credits “ludicrous” — my guess is that particular “fix” is off the table for now.