Ford Will Keep Battery Factory Even If Republicans Ax Tax Break(nytimes.com)
nytimes.com
Ford Will Keep Battery Factory Even If Republicans Ax Tax Break
https://www.nytimes.com/2025/06/23/business/ford-battery-factory-electric-vehicles.html
63 comments
These efforts are struggles to maintain the status quo for entrenched interests against unsurmountable momentum as it relates to the clean energy transition [1] and the electrification of transportation. If you're looking for a rational explanation, the human will disappoint. Simply maintain pace and pressure in the appropriate direction. That effort, combined with time, will hopefully equal success. In my personal opinion, the "why" is important to understand from a threat model perspective (ie how do you hack around humans and entities attempting to slow or stop the transition), but not important as a contributor to input to speed the transition (because mental models and identity are rigid, and you're not taking the selfish out of the human, broadly speaking).
[1] Texas Legislature Beats Back Assault on Clean Energy - https://news.ycombinator.com/item?id=44277367 - June 2025
(China installed 93GW of solar in May 2025, more than every other country combined in 2024: https://news.ycombinator.com/item?id=44359105)
[1] Texas Legislature Beats Back Assault on Clean Energy - https://news.ycombinator.com/item?id=44277367 - June 2025
(China installed 93GW of solar in May 2025, more than every other country combined in 2024: https://news.ycombinator.com/item?id=44359105)
Nobody is trying to stop the transitions, electric cars are a dog and for shit. Specifically the batteries, they're hyper-expensive, the range is for crap, and they need to be replaced every X years.
The left was idiotic to think dumping Peter's tax money to buy Paul's new e-car, then in other cases outright legally banning non-electric cars, was the way to achieve this. To me, it's as silly as if the government got the idea in its head that steam engine is the winner and starts incentivized steam engine cars, with a year 2030 all-steam-engine goal.
The way to overcome this so-called "entrenched interests" is clear as a bell, it's not some dramatic political struggle against forces old and evil. Electric cars are already in principle more powerful, simpler, and cheaper, than combustion engines, an amazing concept. Only issue is the battery. Government should have been, and should be, pumping money into developing a non-crappy battery, THEN when that's ready, there would be no need to incentivize people. The subsequent cars would be cheaper AND better. Let market forces decide, legislating what people ought to purchase is what is called a command and control economy and evidence shows that's bad
The left was idiotic to think dumping Peter's tax money to buy Paul's new e-car, then in other cases outright legally banning non-electric cars, was the way to achieve this. To me, it's as silly as if the government got the idea in its head that steam engine is the winner and starts incentivized steam engine cars, with a year 2030 all-steam-engine goal.
The way to overcome this so-called "entrenched interests" is clear as a bell, it's not some dramatic political struggle against forces old and evil. Electric cars are already in principle more powerful, simpler, and cheaper, than combustion engines, an amazing concept. Only issue is the battery. Government should have been, and should be, pumping money into developing a non-crappy battery, THEN when that's ready, there would be no need to incentivize people. The subsequent cars would be cheaper AND better. Let market forces decide, legislating what people ought to purchase is what is called a command and control economy and evidence shows that's bad
> electric cars are a dog and for shit. Specifically the batteries, they're hyper-expensive, the range is for crap, and they need to be replaced every X years.
They are expensive, that's true, but the range is such a non-issue for anyone who can charge at home and drives a reasonable commute (i.e. doesn't need to stop to charge on their way home every day), and battery degradation is less than 2% per year.
> Let market forces decide, legislating what people ought to purchase is what is called a command and control economy and evidence shows that's bad
Equating regulation with communism is really tired rhetoric.
They are expensive, that's true, but the range is such a non-issue for anyone who can charge at home and drives a reasonable commute (i.e. doesn't need to stop to charge on their way home every day), and battery degradation is less than 2% per year.
> Let market forces decide, legislating what people ought to purchase is what is called a command and control economy and evidence shows that's bad
Equating regulation with communism is really tired rhetoric.
So short sighted and self destructive. The US is actively sabotaging its future in innovation, manufacturing and energy. For what? To make its car industry even less competitive? The world is moving on with or without the US, as you say.
For profits today. There is no will or care to invest for the future in the US.
Wonder if it's just that, or whether there is a more sinister mindset in place that would gladly see the country slide in reverse towards a backward theocracy that would be easier to control.
I mean, it's not exactly hard to see what the cause is of the resistance to electric cars and renewable energy: it's a combination of the vastly wealthy fossil fuel industry throwing its weight around, and specifically behind the Republican Party, and said party taking that and turning it into an ideological issue almost akin to a religion.
There are certainly some with power who are keen to "see the country slide in reverse towards a backward theocracy that would be easier to control", but by and large they're just riding an existing wave that's largely an emergent property of the system, while maybe making some nudges here and there to reduce the resistance to said wave.
There are certainly some with power who are keen to "see the country slide in reverse towards a backward theocracy that would be easier to control", but by and large they're just riding an existing wave that's largely an emergent property of the system, while maybe making some nudges here and there to reduce the resistance to said wave.
Honestly I think it’s neither, it’s just stupidity, incompetence and spite.
Do you mean there is no will to make public investments in the future? Because in the private space the US leads the world in investing in the future. Think about how much we invest in AI and self driving! I think a US private company pioneered electric cars.
> I think a US private company pioneered electric cars.
Electric cars have been around since the late 1800s. If you mean modern ones, in the US the California Air Resources Board basically willed them back into existence in the 90s, and a California automaker (Tesla pre-Musk) made great strides in their public esteem by putting a battery pack and electric motor into a Lotus chassis and selling it as the "Roadster" (leaning on the prior art of companies like Ford and especially GM's EV1).
Electric cars have been around since the late 1800s. If you mean modern ones, in the US the California Air Resources Board basically willed them back into existence in the 90s, and a California automaker (Tesla pre-Musk) made great strides in their public esteem by putting a battery pack and electric motor into a Lotus chassis and selling it as the "Roadster" (leaning on the prior art of companies like Ford and especially GM's EV1).
That US private company was significantly enabled by a (apparently temporary) government policy of direct and indirect financial support. That company does not exist without the direct and intentional support by the US government.
I argue you are overvaluing AI and self driving and undervaluing the capability to build high-tech products, systems, and infrastructure.
no, they mean there's no interest in tomorrow's profits when you can have them today. besides "they" won't be here tomorrow, so get it now. Don't be a simp and leave things for someone else.
It's not really "for" anything besides letting increasingly-marginalized people feel like they have some agency. Of course, choosing to politically express themselves with spite instead of constructive solutions based on what they want is exactly why they continue to be increasingly marginalized.
That sounds exactly like the MAGA plan. bigOil is too ingrained into the party to allow the demand for their product to reduce by eliminating ICE powered anything. To expect MAGA to dump bigOil would be more productive to bang your head on the keyboard and expect to write the code for anything.
Hybrids will be viable for a long time for regions of the world that don't have ready access to a charging station and for users that need to make long trips without delays from 30+ minute charge times.
Hybrids only are viable so long as they exist in large numbers thus ensuring that there is enough money to be made in having infrastructure. Since getting a PHEV I've massively cut down my gas purchases. Car buyers who care about money are catching on to just how much cheaper it is to fuel and EV, and the PHEV looks like the best of both worlds (lets not get into that debate). I'm predicting that in about 5 years EVs will be common enough that gas stations stop going up as fast - not that they will go out of business, but they companies building them will be more careful about there they put them in because demand just isn't there in many locations. Starting in 10 years there will be an increase in the number of going out of business because the demand just isn't there to support several of them on less busy corners. (both of these will be hard to see at first - there are other business cycles in play that make the trends hard to be sure of so it will be another decade before you can be sure) In 20 years gas will be hard to find - not impossible (collectors will still buy it, and long distance travel will be the last place is goes away so freeways will keep it much longer)
Gas stations in the US are already built today to be low margin "loss leaders" (or nearly so) for convenience stores and supermarkets. Low margin can imply a high price sensitivity (as prices rise, they don't stay in business). There are possible snow ball effect scenarios where gas pumps could start to disappear much more rapidly once some tipping point occurs.
Back to the other topic, having owned a PHEV for more than a decade now, it's such an obvious compromise that doesn't make a lot of sense long term. It made great sense when I bought the car more than a decade ago, but today the weight carrying around a gas engine and gas tank would be so much better put to use on extra battery range rather than a gas engine you need a lot less often than you think you do. The only person I'd recommend a PHEV to is whoever I sell my current car to when there's a full BEV I want to buy. But I've also had years where I've gotten the "use it before stale" warnings where my only use of gas that year was because I had no other use for gas and my car suggests keeping the age of gas below a year old, and I recognize there are still a lot of anecdotal use cases of extreme daily/weekly/monthly mileage in the US that I cannot speak to.
Back to the other topic, having owned a PHEV for more than a decade now, it's such an obvious compromise that doesn't make a lot of sense long term. It made great sense when I bought the car more than a decade ago, but today the weight carrying around a gas engine and gas tank would be so much better put to use on extra battery range rather than a gas engine you need a lot less often than you think you do. The only person I'd recommend a PHEV to is whoever I sell my current car to when there's a full BEV I want to buy. But I've also had years where I've gotten the "use it before stale" warnings where my only use of gas that year was because I had no other use for gas and my car suggests keeping the age of gas below a year old, and I recognize there are still a lot of anecdotal use cases of extreme daily/weekly/monthly mileage in the US that I cannot speak to.
Gas is low margin high volume and so a third of the profits anyway. The stuff inside is high margin but they don't sell as much so it balances out.
Right, but that's still the point: gas stations have mostly already stopped existing that don't have a nearby high margin draw. At least in my part of the US most gas stations are "clubs" designed to further encourage regular spending on high margin stuff. (Grocery rewards points, car wash memberships, things like that.)
EVs will disrupt that "high volume" part of it. How long will the "clubs" keep the expensive equipment maintained and running as volume shifts? What price point is too low margin? What price point is too high that volume further drops? (How likely is that to spiral?)
It's not entirely just theoretical, the 1970s showed things happen to gas stations quickly when prices change. We've already seen the death of the "non-club" gas station accelerate in the last three decades, even as the "clubs" build more than ever, further out from city cores, further out into the suburbs and the exurbs. The urban gas station is disappearing/has been disappearing for decades. Gas stations are no longer a foundational part of the urban experience, they are moving out to the edges.
As demand changes from EVs, I expect things to get weird and possibly quickly, because the economics model of gas has always been weird but has been put up with because it is high volume enough. When the high volume is disrupted, what do you expect happens?
EVs will disrupt that "high volume" part of it. How long will the "clubs" keep the expensive equipment maintained and running as volume shifts? What price point is too low margin? What price point is too high that volume further drops? (How likely is that to spiral?)
It's not entirely just theoretical, the 1970s showed things happen to gas stations quickly when prices change. We've already seen the death of the "non-club" gas station accelerate in the last three decades, even as the "clubs" build more than ever, further out from city cores, further out into the suburbs and the exurbs. The urban gas station is disappearing/has been disappearing for decades. Gas stations are no longer a foundational part of the urban experience, they are moving out to the edges.
As demand changes from EVs, I expect things to get weird and possibly quickly, because the economics model of gas has always been weird but has been put up with because it is high volume enough. When the high volume is disrupted, what do you expect happens?
US gasoline is cheaper today than it was 20 years ago after correcting for inflation. They seem to be making do with less real profit than in the past.
Why wouldn't gas stations just start putting in EV charging stations?
I mean, I suppose it's possible there's some level of regulatory hurdle I'm not aware of, but it would seem to be a fairly obvious combination. Hell, AIUI most EV chargers still take longer than a gas pump does to "fill up" a car, so that would make it even more likely for the driver (and passengers if present) to hang about in the convenience store for longer and buy some of the stuff that actually makes the place money.
I mean, I suppose it's possible there's some level of regulatory hurdle I'm not aware of, but it would seem to be a fairly obvious combination. Hell, AIUI most EV chargers still take longer than a gas pump does to "fill up" a car, so that would make it even more likely for the driver (and passengers if present) to hang about in the convenience store for longer and buy some of the stuff that actually makes the place money.
A convenience store might like having the customers hanging around for 10 minutes instead of 5, but not for the 30+ minutes that the Internet tells me it takes even at a Level 3 charging station. That would probably mean spending a bunch of money to put in entertainment or a restaurant or something to keep the customers busy longer-term. That might be profitable, but not necessarily.
Maybe it'll go the other way: restaurants and theaters and the like will put in charging stations that you can hook up to while you're there as a paying customer.
Maybe it'll go the other way: restaurants and theaters and the like will put in charging stations that you can hook up to while you're there as a paying customer.
Not sure what's supposed to happen, but I can guess what will happen instead: US states will have to pay upfront for new factories to be built instead of promising tax breaks later, because the companies that decide whether to build will trust the promises less than until now.
Counter productive to whom? Certainly not oil companies, nor the politicians that represent their interests?
Not really productive for oil companies either. They can fight, but they can't bring down oil prices enough to compete and consumers are catching on.
> What is supposed to happen?
That's an argument from a rationality perspective. This is a decision from ideology. It's not about making the best choice, it's about making sure the right people lose.
That's an argument from a rationality perspective. This is a decision from ideology. It's not about making the best choice, it's about making sure the right people lose.
Yes and: all these cuts (Medicaid, USAID, BIL/IRA, DOGE, ...) are to fund Big Beautiful Bill's tax cuts.
Were IRA the victim of Big Oil's revanchism, we could at least understand.
This is just theft.
Were IRA the victim of Big Oil's revanchism, we could at least understand.
This is just theft.
> makers doubles down on ICE cars while the rest of the world moves in the other direction?
Automotive EE here…
As respectfully as I can; you have no idea what you are talking about and neither do the people cheering you on.
These vehicles are not ready for the markets they are (were) being pushed to.
Current electrics do not make sense in specifically hot or cold climates. They do not make sense for hard use. They do not make sense for long trips. They do not make sense for repair.
They make sense in California for people that will keep them only a couple of years until the next status symbol is available.
I own an electric, I work on some. I like the pluses, and am keenly aware of the negatives. I see people storing them outside in snow and it makes me sad for their owners that think they bought an alternative to an ICE vehicle.
EVs today are not alternatives to ICE vehicles, the are compliments.
Fun fact… right now with the systems today, most EVs that will need a new battery, will be totaled by that cost. I have the tools, I’ve been inside the 600V packs that can easily kill you. Mechanics aren’t trained, prepared for, or will accept the risk. These are not 20 year vehicles. They’re basically 8 year vehicles currently.
Disagree with your feelings all you like, I live it.
Automotive EE here…
As respectfully as I can; you have no idea what you are talking about and neither do the people cheering you on.
These vehicles are not ready for the markets they are (were) being pushed to.
Current electrics do not make sense in specifically hot or cold climates. They do not make sense for hard use. They do not make sense for long trips. They do not make sense for repair.
They make sense in California for people that will keep them only a couple of years until the next status symbol is available.
I own an electric, I work on some. I like the pluses, and am keenly aware of the negatives. I see people storing them outside in snow and it makes me sad for their owners that think they bought an alternative to an ICE vehicle.
EVs today are not alternatives to ICE vehicles, the are compliments.
Fun fact… right now with the systems today, most EVs that will need a new battery, will be totaled by that cost. I have the tools, I’ve been inside the 600V packs that can easily kill you. Mechanics aren’t trained, prepared for, or will accept the risk. These are not 20 year vehicles. They’re basically 8 year vehicles currently.
Disagree with your feelings all you like, I live it.
The country with the highest adoption of EV's in the world is Norway. If they can deal with the cold, so can the US.
I have an EV in Minnesota and it's great. Battery life does take a pretty big hit in winter but that's fine based on how I use it. The real problem is lack of charging infrastructure, not the range.
I have an EV in Minnesota and it's great. Battery life does take a pretty big hit in winter but that's fine based on how I use it. The real problem is lack of charging infrastructure, not the range.
Good point! I should have been the first to point out that battery tech has different rules in Norway. That a wealthy population half that of New Jersey is a good sample. And that any push for EVs in there reflect only realities of the product’s durability and nothing else like marketing or a shallow veneer of concern for “the environment” while they literally survive on oil. I can believe I didn’t think to use “the highest adaptation of EVs” as good metric.
>I have an EV in Minnesota and it's great.
Today. I’m sure it is. That “big hit” you take in the winter, will only ever get worse. Eh, but maybe I’m wrong! Maybe I should change jobs.
>I have an EV in Minnesota and it's great.
Today. I’m sure it is. That “big hit” you take in the winter, will only ever get worse. Eh, but maybe I’m wrong! Maybe I should change jobs.
> They’re basically 8 year vehicles currently.
The major EV makers provide an 8 year warranty on their batteries. If EV batteries only lasted 8 years on average, it means they'd be replacing half of them under warranty, which would cost them a fortune and show up on their balance sheet. Tesla & Hyundai aren't bankrupt; batteries last significantly longer than 8 years.
The major EV makers provide an 8 year warranty on their batteries. If EV batteries only lasted 8 years on average, it means they'd be replacing half of them under warranty, which would cost them a fortune and show up on their balance sheet. Tesla & Hyundai aren't bankrupt; batteries last significantly longer than 8 years.
You do not get a battery replaced anytime you want. If you think this is how it works, I suggest you read the fine print about normal wear and tear on “consumable parts”.
I’m sure some mfg was selling 10 year warranties on this gen 1.5 of EVs, and they will take a hit. Believe it or not though, the MBAs that pushed to market to bad fit consumers, yea, they know what they’re doing.
I’m sure some mfg was selling 10 year warranties on this gen 1.5 of EVs, and they will take a hit. Believe it or not though, the MBAs that pushed to market to bad fit consumers, yea, they know what they’re doing.
Assuming the announcements from CATL and BYD pan out and battery prices continue on their current trajectory:
By 2030 EV's will cost less than an ICE powered vehicle up front, travel further on a single charge than an ICE with a full tank, cost less to maintain, take about the same amount of time to "refuel" (if you need to do that at all because you can recharge for free at a solar powered home) ... and won't be built in the USA if Ford doesn't do something like this. It probably won't be in the USA even with Ford's efforts.
If you are an automotive EE and live and work in the USA, you've got very little time left to get your finger out. Even if you do and are insanely clever, you've got 3.5 more years of Trump and the GOP playing to the denial crowd, putting up barriers like this to any attempt to change from the status quo. You're also up against a highly industrialised country with four times the number of EE's the USA, some of which are also insanely clever, all being forced to innovate in a highly competitive market fueled by government subsidies.
Personally, if I were you, I'd be assuming the car manufacturing industry in the USA is fucked, and looking for another industry to transition my EE skills into.
By 2030 EV's will cost less than an ICE powered vehicle up front, travel further on a single charge than an ICE with a full tank, cost less to maintain, take about the same amount of time to "refuel" (if you need to do that at all because you can recharge for free at a solar powered home) ... and won't be built in the USA if Ford doesn't do something like this. It probably won't be in the USA even with Ford's efforts.
If you are an automotive EE and live and work in the USA, you've got very little time left to get your finger out. Even if you do and are insanely clever, you've got 3.5 more years of Trump and the GOP playing to the denial crowd, putting up barriers like this to any attempt to change from the status quo. You're also up against a highly industrialised country with four times the number of EE's the USA, some of which are also insanely clever, all being forced to innovate in a highly competitive market fueled by government subsidies.
Personally, if I were you, I'd be assuming the car manufacturing industry in the USA is fucked, and looking for another industry to transition my EE skills into.
Yes, doesn’t quite help current owners though does it?
They will be good. They aren’t now. The entire market is cooling before it turns in to backlash.
>I'd be assuming the car manufacturing industry in the USA is fucked
Ha, well, I guess the most comforting thing I can tell you is that it’s OK you don’t know anything about how cars are actually made. It took Tesla a decade of building them and they still haven’t entire figured it out. No, automotive industry isn’t going anywhere. It’s got its own ups and downs and quirks, but overall we’ll be selling cars in 2050 no question.
They will be good. They aren’t now. The entire market is cooling before it turns in to backlash.
>I'd be assuming the car manufacturing industry in the USA is fucked
Ha, well, I guess the most comforting thing I can tell you is that it’s OK you don’t know anything about how cars are actually made. It took Tesla a decade of building them and they still haven’t entire figured it out. No, automotive industry isn’t going anywhere. It’s got its own ups and downs and quirks, but overall we’ll be selling cars in 2050 no question.
EVs are better suited to most commute patterns. The ICE would be the compliment, and the EV, the daily driver.
With better charging infrastructure, that most turns into virtually all.
With better charging infrastructure, that most turns into virtually all.
EVs are good for commutes. Yes. That was not the marketing that has been dropped because it started to backfire.
All the MFGs know electric will be the future.
But, I’m working on truck stuffs for 2034, and guess what? ICE.
All the MFGs know electric will be the future.
But, I’m working on truck stuffs for 2034, and guess what? ICE.
isn't it well known that the avg commute is only 35 miles for a consumer? and how many road trips does an avg consumer take in a month? in a year? they can always rent an ICE for specific long journeys.
not being able to take your car on a road trip speaks more about infrastructure issues and not the car itself.
Hybrids once again totally undervalued. I don't know why the industry and the consumers are going so hard on pure EVs
Hmm, I drive a PHEV, but full EVs are extremely simple vehicles, as long as you work out charging, they'll need tires eventually, and brake pads (slowly, since they mostly have regen), and that's about it. No fluids (and leaks), no belts, no going to gas stations - pretty compelling for the motorist (and scary for dealerships and repair shops).
I don’t have an EV, but I think I would like one.
Some days I repeat your ideas in my head and think the EV would be great. Other days, I consider the places I see ICE vehicles needing work—- suspension pieces, air conditioning, electronic bits, lights, etc and I think otherwise.
Really, I haven’t had a problem with an ICE engine or transmission in a long time. ( Including my 20 year old crv, which just keeps running. The suspension is getting creaky, though. )
I wish there was more information available about early Teslas and how they’re doing today. I just don’t have a good feel for longevity.
Some days I repeat your ideas in my head and think the EV would be great. Other days, I consider the places I see ICE vehicles needing work—- suspension pieces, air conditioning, electronic bits, lights, etc and I think otherwise.
Really, I haven’t had a problem with an ICE engine or transmission in a long time. ( Including my 20 year old crv, which just keeps running. The suspension is getting creaky, though. )
I wish there was more information available about early Teslas and how they’re doing today. I just don’t have a good feel for longevity.
Among other reasons, a lot of it is simply because everyone wants raw battery range and PHEVs are a huge compromise on battery range. Internal combustion engines and gas tanks eat a lot into the weight and volume budgets of a car. You can fit a lot of battery in that weight and volume. We've got to the point where battery density is getting strong enough that a hybrid can't make a combined range as good as a pure EV either in the same weight class.
Another reason is that if you design for the strengths of pure EVs, you can shift all of that weight lower and out of cabin and storage space, including offering new perks such as "frunks" ("front trunks").
A hybrid can't compete on cabin/storage space with a pure EV designed to be a pure EV, and can't quite compete on battery range.
Another reason is that if you design for the strengths of pure EVs, you can shift all of that weight lower and out of cabin and storage space, including offering new perks such as "frunks" ("front trunks").
A hybrid can't compete on cabin/storage space with a pure EV designed to be a pure EV, and can't quite compete on battery range.
EV range drops to around 90% after 10 years, but so has my 12 year old Mazda. I don't consider it totaled.
Beyond optimistic to the point that it isn’t worth trying to convince you of reality.
20% at 10 years.
20% at 10 years.
I am huge believer in the eventual dominance of battery-electric vehicles, but these tax incentives are very inefficient. The money would be better spent on R&D into batteries and motors. The time would be better spent making it easier to build.
It would be better spent on UBI and walkable cities but you know, sometimes the only progress we get is what voters will support
Yes, Build Back Better would have been better. And we would've needed IRA 2, 3, and probably 4 to have any hope of achieving netzero by 2050.
That the Biden Admin even got IRA passed was an amazing feat.
That the Biden Admin even got IRA passed was an amazing feat.
Good, that's the way it should be. If EVs are the future of personal vehicles (and I think they will be), then there's all the reasons to trade short term pain for long term gain.
That's assuming the market is homogeneous and resources are fungible. If interest in EVs in the US is low, nobody builds battery factories in the US. But we know China and others are. If it takes EVs another two decades to really catch on in the US, all the parts and materials will be foreign. Costs will be higher for domestic consumers, even if interest does pick up eventually. Catching up at that point may not even be possible.
Consider that if Asia and Europe manage to replace a majority of ICE vehicles in a decade or two with EVs, oil production will necessarily decrease in the end. We'll have a glut of cheap oil for a while as other countries buy less, which will artificially prop up ICE vehicles until production slows and costs go up. When gasoline inevitably becomes prohibitively expensive (assuming EVs are indeed the future), the US could be left with pricey fuel and no real ability to dig itself out of the hole it's created. It's not just the battery factories, it's the knowledge, talent, supply chains, trade deals, infrastructure, sales pipelines, patents, etc.
The "long term gain" turns out to just be us killing off our entire auto industry slowly. The "free market" in this case is actually "the free market here in our bubble". Globalization isn't going to sell cheap Chinese EVs in Montana, and people buying an $8000 BYD aren't going to look at a Chevy Malibu. If/when that market eventually collapses because we got left behind by the rest of the world, we'll be regretful that we didn't put subsidies into batteries and the grid. After all, we did subsidize oil and the auto industry for decades and decades for this reason. How many politicians stumped on the promise of keeping Detroit going?
Consider that if Asia and Europe manage to replace a majority of ICE vehicles in a decade or two with EVs, oil production will necessarily decrease in the end. We'll have a glut of cheap oil for a while as other countries buy less, which will artificially prop up ICE vehicles until production slows and costs go up. When gasoline inevitably becomes prohibitively expensive (assuming EVs are indeed the future), the US could be left with pricey fuel and no real ability to dig itself out of the hole it's created. It's not just the battery factories, it's the knowledge, talent, supply chains, trade deals, infrastructure, sales pipelines, patents, etc.
The "long term gain" turns out to just be us killing off our entire auto industry slowly. The "free market" in this case is actually "the free market here in our bubble". Globalization isn't going to sell cheap Chinese EVs in Montana, and people buying an $8000 BYD aren't going to look at a Chevy Malibu. If/when that market eventually collapses because we got left behind by the rest of the world, we'll be regretful that we didn't put subsidies into batteries and the grid. After all, we did subsidize oil and the auto industry for decades and decades for this reason. How many politicians stumped on the promise of keeping Detroit going?
Not to mention the market is bad at capturing externalities. Tax incentives are one way to offset externalities that the market doesn't price in. If tax incentive carrots are the "wrong way" to do it because they favor some companies more than others, then carbon/emissions taxes sticks are the "right way" to do it that provide a level "playing field" based on usage/consumption. (Arguably the most correct answer is "both" to get the "free-est market" with the most "information" about what society values priced into market supply and demand. Because "free" implies liquidity to follow the most "information" in the OG Adam Smith et al definitions, not free from incentives and disincentives.)
What is the short term pain exactly?
Presumably short term pain for Ford from missing out on federal incentives they would've gotten otherwise
This also hurts innovation into more efficient gas engines for hybrids. Without needing the engine to power the wheels new engine types become viable.
It’s unclear if they will or won’t - but given the current presidents tendency to attack any entity that crosses him with “lawfare” it doesn’t seem safe to accurately project their intentions
Dig1t(1)
What is supposed to happen? The US and vehicle makers doubles down on ICE cars while the rest of the world moves in the other direction?
Sounds like a good way to trash any competitiveness US car makers have....