With President-elect Joe Biden preparing to take office in January and his leadership team beginning to take shape, the auto industry has an opportunity to rewrite its relationship with Washington and advance an agenda that steers the U.S. toward an electrified and automated future.
John Bozzella, CEO of the industry’s leading lobbying group, said the Alliance for Automotive Innovation is “moving with a sense of urgency” as it encourages members of Congress and the incoming administration to look at policy proposals unveiled by the group this month.
The chief executive said now is the time for the sector and U.S. policymakers to work together and secure the nation’s position as a global leader.
“The countries that lead the development and adoption of these technologies — whether it’s electrification, highly automated vehicles or other connected technologies — those are the countries that are going to shape the supply chains,” Bozzella told Automotive News.
“They’re going to develop the running rules and potentially shape what the international automotive market looks like in the future,” he said. “We want this country to lead.”
Following the release of an AV policy road map, the alliance last week unveiled its auto innovation agenda, outlining eight supply-and-demand policy approaches for ensuring U.S. competitiveness in those forward-looking technologies.
In the report, the alliance urges policymakers to support efforts that will encourage the adoption of electric vehicles and modernize regulatory oversight of AVs and other new technologies.
“The long-term future of the industry and the auto market is zero net carbon and electric drive. That is where we’re headed. That’s where we all want to go,” Bozzella said. “In the midterm to long term, we need to be working effectively with all policymakers across the spectrum at the local, state and federal level to help shift toward that future.”
The alliance’s policy platform is in line with Biden’s climate and energy plans.
On the campaign trail, he pledged to build hundreds of thousands of EV charging stations nationwide and said he supports consumer incentives for EV purchases as well as swapping the government’s fleet with electric models.
“There’s a lot of unity of purpose,” Bozzella said. “There’s a lot of opportunity for us to work together.”
Biden last week chose former presidential rival Pete Buttigieg as his nominee to lead the U.S. Department of Transportation.
The transportation secretary will work with “states, business and labor to install 500,000 charging stations for the next generation of clean vehicles, smart grid systems that reduce energy consumption and to usher in a clean-energy economy all across the country,” Biden said in remarks last week.
The president-elect also picked former Michigan Gov. Jennifer Granholm as his energy secretary and North Carolina environmental regulator Michael Regan as EPA administrator.
If confirmed by the Senate, the three officials will be tasked with implementing the centerpieces of Biden’s “Build Back Better” agenda, such as modernizing infrastructure and shaping future transportation, energy and climate policy.
Any efforts by the Biden administration to boost EVs in the U.S. could still be impeded by low consumer adoption of those vehicles and a divided Congress, if Democrats don’t win both Senate seats in Georgia in next month’s runoff elections.
Without control of the Senate, “it’s a whole lot harder,” Chris Krueger, Washington strategist for financial services firm Cowen Washington Research Group, said last week during a webinar hosted by the alliance.
Still, many of the alliance’s members, which include most major automakers in the U.S. as well as some suppliers and tech companies, are investing billions in EVs and revamping their lineups to make way for more.
General Motors, for example, said last month it is increasing its spending on EVs and AVs by 35 percent to $27 billion and that 40 percent of its U.S. lineup will be electric by the end of 2025.
Michelle Krebs, executive analyst at Autotrader, said the industry still has “a ways to go,” with zero-emission vehicles — fuel cell, battery-electric and plug-in hybrid — making up about 2 percent of new light-duty vehicles sold in the U.S.
“There is lots of room for improvement,” Krebs said in the webinar. “It gets a lot more publicity than it actually does sales.”
Carla Bailo, another webinar panelist, said the likelihood that the Biden administration will set more stringent fuel economy and emissions standards “bodes well” for the EV market, but the technology needs to be produced in the U.S. for long-term sustainability.
“We’re already behind in batteries,” said Bailo, CEO of the Center for Automotive Research in Ann Arbor, Mich. “We can’t let that happen with any of the other technologies.”
The alliance, in its agenda, said China “has already established an EV battery supply chain and manufacturing dominance” and is “moving aggressively” to lead in AVs. Europe is also not far behind on building a battery market, Krebs noted.
“It’s about the political will to be a leader,” Krebs said. “It’s going to take a concerted effort by multiple parties to move us in that direction, and that is not easy.”
In the meantime, Bozzella said the alliance is going to work with the Biden administration and new Congress on its policy agenda to develop a coordinated national approach.
“It’s a strong opportunity for us to align around securing our position — America’s position — as the driver of globally competitive automotive technology,” he said. “Now is the time to continue this progress and accelerate it.”