|
General
Motors
CEO Mary
Barra
speaks
to
reporters
after a
meeting
with
Sen.
Sherrod
Brown,
D-Ohio,
and Sen.
Rob
Portman,
R-Ohio,
to
discuss
GM's
announcement
it would
stop
making
the
Chevy
Cruze at
its
Lordstown,
Ohio,
plant,
part of
a
massive
restructuring
for the
Detroit-based
automaker,
on
Capitol
Hill in
Washington,
Wednesday,
Dec. 5,
2018.
General
Motors
is
fighting
to
retain a
valuable
tax
credit
for
electric
vehicles
as the
nation's
largest
automaker
grapples
with the
political
fallout
triggered
by its
plans to
shutter
several
U.S.
factories
and shed
thousands
of
workers.
(AP
Photo/J.
Scott
Applewhite) |
|
GM
fights
government
to
retain
tax
credit
for
electric
cars
By
RICHARD
LARDNER
APNews.com
WASHINGTON
-
General
Motors
is
fighting
to
retain a
valuable
tax
credit
for
electric
vehicles
as the
nation’s
largest
automaker
tries to
deal
with the
political
fallout
triggered
by its
plans to
shutter
several
U.S.
factories
and shed
thousands
of
workers.
Preserving
the
$7,500
tax
incentive
for
buyers
is
crucial
for GM
as the
company
pivots
from
internal
combustion
engines
in favor
of
building
cars
powered
by
batteries
or
hydrogen
fuel
cells.
Yet the
layoffs
and
plant
closings
could
imperil
GM’s
push to
keep the
incentive.
It helps
make
plug-ins
such as
the
$36,000
Chevy
Bolt
more
affordable
at a
time
when
competition
from
other
electric
vehicle
makers
is
heating
up.
GM
faces
opposition
from
President
Donald
Trump
and
other
Republicans
who
consider
the
credit a
waste of
taxpayer
money
and want
it
eliminated.
Trump,
who has
pledged
a
manufacturing
rebirth
in the
Midwest,
reacted
angrily
to GM’s
”transformation
”
announcement
late
last
month,
declaring
that his
administration
was
“looking
at
cutting
all GM
subsidies,
including
for
electric
cars.”
The
company
already
is on
the
verge of
being
phased
out of
the tax
credit
program
unless
Congress
changes
a law
that
caps the
break at
200,000
vehicles
per
manufacturer.
Without
the
incentive,
GM may
be
forced
to cut
the
price of
its
electric
cars to
keep
prospective
customers
from
taking
their
business
elsewhere,
according
to
automotive
industry
experts.
As
evidence
of the
credit’s
importance
to GM’s
future,
the
automaker
has
expanded
its
lobbying
footprint
in
Washington
and even
joined
forces
with two
rivals,
Tesla
and
Nissan,
to call
for
200,000-vehicle
limit to
be
scrapped.
Standing
in the
way of
that
goal is
Sen.
John
Barrasso,
R-Wyo.,
the
chairman
of the
Senate
Environment
and
Public
Works
Committee.
Barrasso
introduced
legislation
in
October
to
abolish
the tax
credit,
a move
he said
would
save
about
$20
billion
over the
next 10
years.
He has
argued
the
market
for
electric
vehicles
is
already
established
and “no
longer
needs
the
crutch
of
government
assistance.”
“The
idea of
the
subsidies
had to
do with
trying
to make
sure
that
electric
vehicles
would be
a viable
technology,”
Barrasso
said.
“Well,
that’s
clearly
there.”
The
tax
credit
came up
briefly
during a
private
meeting
on
Wednesday
between
Ohio’s
senators,
Republican
Rob
Portman
and
Democrat
Sherrod
Brown,
and GM
chief
executive
Mary
Barra,
according
to a
congressional
aide
familiar
with the
conversation.
As part
of the
restructuring,
GM said
it will
stop
making
the
Chevy
Cruze at
its
Lordstown,
Ohio,
plant by
March
and is
considering
closing
the
plant
for
good.
Portman
told
Barra
that
it’s
difficult
to help
with
priorities
such as
the
electric
vehicle
credit
when GM
is
moving
production
out of
Ohio,
according
to the
aide,
who was
not
authorized
to
publicly
discuss
the
private
conversation
and
spoke on
condition
of
anonymity.
One
of the
lobbyists
working
to
salvage
the
credit
for GM
is Kent
Hance, a
former
chancellor
of Texas
Tech
University
who is
well
connected
in GOP
circles,
according
to his
online
profile
. Hance
lists
his role
as a
fundraiser
for the
campaigns
of
outgoing
House
Speaker
Paul
Ryan,
R-Wis.,
Senate
Majority
Leader
Mitch
McConnell,
R-Ky.,
House
Majority
Leader
Kevin
McCarthy,
R-Calif.,
and
others.
He has
known
Rick
Perry,
the
energy
secretary
and
former
Texas
governor,
for
nearly
30
years.
GM
in early
August
named a
former
Trump
White
House
official,
Everett
Eissenstat,
its
senior
vice
president
for
global
public
policy,
a post
that
oversees
the
company’s
lobbying
operations.
Eissenstat,
however,
is not
registered
as a
lobbyist,
according
to
disclosure
records
filed
with
Congress.
Before
coming
to GM,
he was
Trump’s
deputy
assistant
for
international
economic
affairs.
Under
federal
law, the
$7,500
credit
for
buyers
begins
to phase
out
after a
manufacturer
has sold
200,000
qualifying
electric
vehicles.
GM has
estimated
it will
hit that
threshold
by the
end of
December,
just as
the Bolt
will be
facing
new and
potentially
stiff
competition.
Sam
Abuelsamid,
a senior
analyst
at
Navigant
Research,
said
Hyundai
and Kia
each
will be
selling
compact
SUVs in
the U.S.
beginning
early
next
year
that can
travel
240
miles on
a single
battery
charge,
about
the same
as the
Bolt.
Ford
will be
launching
a number
of new
plug-in
hybrid
models
in 2019,
including
the
Lincoln
Aviator,
Explorer
and
Escape.
“With
the
intensifying
market
shift
away
from
cars to
utility
vehicles
all of
these
are
expected
to be
more
popular
than the
Bolt,”
Abuelsamid
said. To
remain
competitive
against
the new
entries,
“GM will
likely
have to
cut the
(retail
price)
of the
Bolt as
well as
any
additional
EVs they
launch
next
year by
the
corresponding
reduction
in the
tax
credits,”
he said.
Karl
Brauer,
executive
publisher
of
Autotrader
and
Kelley
Blue
Book,
said the
credit
is
“hugely
important”
to
electric
vehicle
manufacturers.
Lowering
the
up-front
cost of
the
vehicle
typically
plays a
significant
role in
sales,
he said,
citing
surveys
that
show
more
consumers
would
buy
electric
vehicles
if the
cars
were
affordably
priced.
GM
joined
forces
with
Tesla
and
Nissan
as well
as
several
consumer
and
environmental
groups
to
broaden
its
lobbying
push
even
further.
The EV
Drive
Coalition,
which
was
launched
in
November,
urged
lawmakers
in an
open
letter
last
week to
put a
provision
in the
must-pass
government
spending
bill
that
does
away
with the
200,000-car
limit.
“Eliminating
the
per-manufacturer
cap will
level
the
playing
field
for all
EV
manufacturers
and spur
innovation
among
domestic
manufacturers,
ensuring
America’s
leadership
in the
hyper-competitive,
global
auto
market,”
the
coalition
said.
Jeannine
Ginivan,
a GM
spokeswoman,
said the
tax
credit
should
be
modified
but
declined
to say
whether
the
automaker
backs a
specific
piece of
legislation
that
would
remove
the cap.
“We
believe
an
important
part of
reaching
a zero
emissions
future
and
establishing
the U.S.
as the
leader
in
electrification
is to
continue
to
provide
a
federal
tax
credit
to help
make
electric
vehicles
more
affordable
for all
customers,”
Ginivan
said in
an
email.
In
addition
to GM’s
in-house
lobbyists,
four
lobbyists
from
Hance
Scarborough,
the
Austin,
Texas-based
firm
that
Hance
founded
in 1994,
are
working
on GM’s
behalf,
including
Hance,
according
to
disclosure
records.
GM
also
contracted
with two
other
lobbying
firms
earlier
this
year to
focus on
electric
and
automated
vehicle
issues:
the
Polaris-Hutton
Group
and the
DS2
Group. A
fourth
firm,
the S-3
Group,
was
hired by
GM in
2014 and
earlier
this
year
added
the tax
credit
to its
portfolio
of
lobbying
issues.
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