Car Dealers Turn on Biden’s EV Policies

President Biden at the General Motors Factory ZERO electric vehicle assembly plant
President Biden at the General Motors Factory ZERO electric vehicle assembly plant in Detroit. | Image by Nic Antaya/Getty Images

An unprecedented rise in the adoption of electric vehicles across the nation is a key element of the Biden administration’s 2022 Climate Act, and it is having some deleterious consequences.

The administration’s aggressive EV push includes the goal of making the majority of new vehicle purchases electric within a decade, according to a White House press release from earlier this year.

A recent report by the Texas Public Policy Foundation (TPPF) found that EVs benefit from regulatory credits and taxpayer-sponsored fuel economy subsidies to the tune of about $28,000 per vehicle, as previously covered by The Dallas Express.

When socialized infrastructure costs, like upgrading the electricity grid to handle the charging demands of thousands of new EVs, are factored in, the taxpayer-backed subsidy per vehicle rises to nearly $50,000.

Fuel economy standards make up the largest chunk of what the report refers to as “the hidden cost of EVs,” and those regulations are becoming increasingly strict. Greenhouse gas emissions standards are also growing stricter due to many states, including bellwether California, enacting zero-emission standards.

The auto industry is sounding the alarm, claiming that the EV push is moving too fast for the needed infrastructure and consumers’ pocketbooks to keep up with.

In an open letter to President Joe Biden, more than 3,000 auto dealers from across the country asked the president to “tap the breaks” on what they call “the unrealistic government electric vehicle mandate.”

The letter argues that EVs “are ideal for many people, and we believe their appeal will grow over time. The reality, however, is that electric vehicle demand today is not keeping up with the large influx of [battery electric vehicles] arriving at our dealerships prompted by the current regulations. BEVs are stacking up on our lots.”

The letter explains that even when subsidized, most car buyers cannot afford EVs or do not have the ability to charge them. Others are concerned with EV limitations compared to gasoline-driven vehicles.

“Today, the supply of unsold BEVs is surging, as they are not selling nearly as fast as they are arriving at our dealerships — even with deep price cuts, manufacturer incentives, and generous government incentives,” the letter reads.

“Some customers are in the market for electric vehicles, and we are thrilled to sell them. But the majority of customers are simply not ready to make the change. They are concerned about BEVs being unaffordable. Many do not have garages for home charging or easy access to public charging stations,” the letter continues. “Customers are also concerned about the loss of driving range in cold or hot weather. Some have long daily commutes and don’t have the extra time to charge the battery. … Today’s current technology is not adequate to support the needs of the majority of our consumers.”

The Dallas Express spoke with Brent Bennett, one of the authors of the TPPF report and a former battery engineer and researcher, about what he considers a misguided push to force EVs on the public.

Bennett told The Dallas Express that one of the primary issues with the subsidies, as noted in the report, is that regulations have outstripped the ability of technology to keep pace.

Auto manufacturers are relying on credits issued by the Environmental Protection Agency to pay for vehicles that do not meet the stricter emission standards. Furthermore, the need for credits has created an opaque secondary market for credit trading worth billions a year. The market’s legality is dubious, according to the TPPF report.

Bennett noted that one overlooked cost of EV promotion is the cost of gas-powered cars, which auto manufacturers are raising to pay for the regulatory credits.

Since the cost of EVs is out of reach for most people, subsidizing EVs for those who can afford them amounts to “a very regressive tax on poor people who need gas vehicles because they still can’t afford EVs,” Bennett claimed.

Bennett suggested that regulators should boost hybrid vehicles instead of promoting all-electric vehicles.

“A hybrid battery is 50 to 100 times smaller than an EV battery,” Bennett said, noting that production of the larger batteries in modern EVs is easily the most expensive component of such vehicles.

Bennett also warned that EV ownership costs may increase if utilities start charging EV owners for the extra strain on the electricity grid when they charge their vehicles. He noted that one benefit to such a policy is that it would at least drive down the socialized costs.

The White House recently released a statement touting the $7.5 billion in taxpayer money the federal government has on hand to spend to implement its EV policy:

“To date, almost $2.4 billion in funding has gone to states, and construction is underway to build out a network of chargers along our highways. Thanks to these investments, the number of publicly available charging ports on America’s roads has surpassed 161,000, nearly a 70% increase since President Biden took office.

“In addition, the Bipartisan Infrastructure Law invests over $7 billion to support the domestic manufacturing of batteries and the extraction, refinement, and processing of the critical materials that power them. This investment, paired with the tax credits in the Inflation Reduction Act, will help accelerate our electric vehicle future, strengthen U.S. supply chains, and create good-paying jobs across the country.”

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