October 26, 2021

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Elon Musk upset over proposed Democratic subsidies for unionized electric car companies

Tesla CEO Elon Musk is criticizing House Democrats and the Biden administration for providing tax incentives for union-made electric cars that won’t help his company or others that are not unionized.

Musk and other automakers say the tax benefit will unfairly boost the business of car companies such as GM, Ford, and Chrysler, which are represented by the United Auto Workers union.

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House Democrats in the Ways and Means Committee introduced a proposal earlier this month, as part of their $3.5 trillion spending bill, that would allow $4,500 in consumer incentives to buy a new electric vehicle, provided it is union-made in the United States.

Tesla, as the only major American car company that is not unionized, is opposed to the proposed benefit, as are foreign automobile giants such as Toyota, Honda, Kia, and Nissan, which say the union-made incentive is discriminatory and biased.

“This is written by Ford/UAW lobbyists, as they make their electric car in Mexico. Not obvious how this serves American taxpayers,” Musk tweeted earlier this week.

Ford is planning to produce more of its electric vehicles in the U.S. next year, which will allow it to take advantage of the new tax incentive.

In the past, Tesla, which is the largest electric vehicle manufacturer in the U.S., has benefited immensely from government incentive programs for electric vehicles, such as the current $7,500 federal tax credit to purchase an electric vehicle. The new $4,500 incentive for union-made electric vehicles would be on top of the existing $7,500 credit for all electric vehicles bought in the U.S.

House Republicans this week also slammed the electric vehicle tax credit plan as ‘perverse’ and ‘unfair.’

Republican Rep. Mike Kelly of Pennsylvania told the Detroit News that the tax incentive would primarily benefit giant automobile corporations and wealthy people, who have the ability to purchase expensive electric cars.

However, Democrats such as Rep. Dan Kildee of Michigan, who has been backed by the United Auto Workers union, say electric cars becoming more affordable and the tax incentives are needed to combat climate change by reducing carbon emissions that come from gas powered vehicles.

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Democrats also say the tax incentive is representative of their priorities and goals.

“The Democratic Caucus strongly values workers’ rights as well as American-based manufacturing, both of which this proposal encourages,” Erin Hatch Thomas, the House Ways and Means Committee’s communications director, said in a statement to the Washington Post.

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Tags: News, Policy, Economy, Car Makers, Car, Electric Vehicles, Tax Credits, Biden Administration, House Ways and Means Committee, House Democrats, Elon Musk, Tesla, GM, Ford, Chrysler

Original Author: Nihal Krishan

Original Location: Elon Musk upset over proposed Democratic subsidies for unionized electric car companies

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