NEW YORK: U.S. auto giants signaled Wednesday they could further slow the ramp-up of electric vehicle production as Detroit awaits the arrival of a Trump administration eager to roll back major climate initiatives. Biden.
Donald Trump’s transition officials have discussed eliminating a $7,500 tax credit for electric vehicles, according to US media. The electric vehicle tax credit was included in President Joe Biden’s signature climate change legislation, the Inflation Reduction Act of 2022.
Trump, who has called climate change a hoax, spoke dismissively during the campaign of the Biden administration’s fuel economy standards as a “mandate” that he said would doom internal combustion engine vehicles (ICE).
U.S. auto industry executives said Wednesday they are bracing for potentially significant policy changes from Washington.
“We are modeling different scenarios and we will adjust accordingly,” John Lawler, Ford’s chief financial officer, said at a Wall Street conference.
Lawler said Ford’s adoption of hybrid vehicles provides greater flexibility as new rules evolve.
He described the potential elimination of the tax credit as exacerbating an oversupply of expensive electric models.
“One of the things we think is there will be incredible pricing pressure next year in the electric vehicle market,” Lawler said. “The only thing we know… is that consumers are not willing to pay much more for electric vehicles than for a thermal vehicle.”
General Motors Chief Financial Officer Paul Jacobson said it was “too early” to speculate on what policies Trump would pursue, but that the company was committing to its electric vehicle strategy as “a goal to pursue.” long term”.
GM is focused on reducing costs throughout electric vehicle development and providing flexibility in operations, such as a factory in Tennessee capable of producing both combustion and electric vehicles, he said.
The well-known automaker could “temper” future stages of investment in electric vehicles depending on market developments, Jacobson said.
Ford and GM have slowed or canceled some electric vehicle projects in recent years amid uneven growth in demand.
Trump transition officials targeting the tax credit include oil executive Harold Hamm, according to reports in the New York Times and other publications.
Trump toned down his own criticism of electric vehicles somewhat during the campaign by working closely with mega supporter Elon Musk, the chief executive of electric vehicle maker Tesla.
Musk said removing the tax credit could harm competitors seeking to challenge Tesla’s leadership in the segment.