Congress Needs to Pick a Lane on EVs

Chairman's Blog: Mike’s Message 06/14/23

When it comes to EV sales and production, there are countless issues worthy of discussion and debate, including tax credits, domestic production capabilities, safety requirements, and our nation’s charging and electric infrastructure. However, dealers and consumers are coming to the realization that looking for a roadmap from Congress showing us the path to real and lasting EV adoption in this country is a fruitless endeavor. As our legislators are all trying to advance their own agendas regarding EV sales and production, it becomes a political football and all we get is more confusion.

Currently, Congress is considering the Build it in America Act, introduced just last week, which would, among other things, completely overhaul the most recent EV credit rules contained within the IRA and replace it, more or less, with the plan that was previously law. If the bill makes it into law (unlikely), it will immediately alter which cars are eligible for the credit. Congress seems to feel that automakers and dealers can turn on a dime, adjusting their supply chains, designs, and inventory instantly based on whatever whim is in favor on Capitol Hill, the White House, or any state regulatory board.

That’s bad news, particularly when you recall that the EPA recently announced its intention to increase the share of EVs sold in the United States from their current 6 percent to 67 percent by 2032. That’s more than ambitious – it’s borderline preposterous. Auto manufacturers and dealers, who up until now have made every effort to work with the U.S. government on building and promoting electric vehicles, despite the nation’s serious lack of EV infrastructure, are rightfully beginning to voice their frustration.

On Monday, John Bozzella, CEO for the Alliance for Automotive Innovation, a manufacturer advocacy group, pointed out that the EPA's proposed rules would primarily benefit China, as it currently has a stranglehold on many of the critical minerals needed to make EV batteries. “Official U.S. policy will have thrown open the doors (and the ports, as it were) to China,” he writes.

On this point, manufacturers are entirely correct.  This is one of the many unintended consequences of legislating EV adoption by mandate.  Thanks to our government’s shifts in EV policy, continuous backtracking, and patchwork of state rules, we are falling behind our global competitors on EV sales and production. 

The solution to our current EV challenge, as in most things, is a balanced approach. Faced with today’s all-or-nothing style of governance, where every possible issue is politicized and sold on 24-hour news channels as a “right” or “left” talking point, we MUST choose a different direction on electric vehicles. That means moving forward in a measured and deliberate way and offering non-discriminatory across-the-board EV tax credits. Washington needs to step back, stop trying to mandate EVs by force, and let the free-market work to shift naturally to EVs at a pace where the infrastructure, domestic supply chains, and willingness of consumers can keep up. 

Mike DeSilva Signature

Mike DeSilva
AIADA Chairman

Chairman's Blog: Mike’s Message

AIADA Chairman Mike DeSilva offers up a dealer's perspective on the 2023 auto retail industry.