What the Biden Administration Might Mean for the Car World
- New President Joe Biden has ambitious plans for transportation and energy policy that could change the way Americans move through the world.
- Biden has selected former Michigan Governor Jennifer Granholm to carry out his energy policy and former South Bend mayor Pete Buttigieg to lead the Transportation department.
- Biden’s plans center on significant infrastructure spending and a move towards sustainability and renewable energy.
Less than 24 hours into the newly-minted Biden administration, Pete Buttigieg, the President’s pick for Secretary of Transportation and the former mayor of South Bend, Indiana, sat for a two-hour confirmation hearing with the Senate’s committee on commerce, science, and transportation.
During the hearing, Buttigieg told Florida senator Rick Scott that all options were on the table when Scott asked if he would support raising the gas tax to increase funding for transportation projects. But within hours, Buttigieg’s spokesperson was telling reporters that though a “variety of options” are being considered, an increase in the gas tax is not one of them.
It’s no surprise that a member of a Democratic administration would want to avoid going on-record in favor of tax hikes this early in the game. The new administration can influence the automotive world in any number of ways, but that back-and-forth didn’t do much to illuminate Biden’s plans. (Confirmation hearings rarely illuminate much.)
During his campaign, Biden focused his public comments about our little corner of the economy on a desire to invest heavily in new infrastructure and support for renewable energy (plus the occasional mention of his beloved ’67 Corvette). Now that Biden has won the job, Pete Buttigieg and former Michigan governor Jennifer Granholm have been nominated to key positions, and will be responsible for carrying out the new President’s agenda.
Granholm has been nominated as Biden’s energy secretary. If confirmed, she’ll start work on the President’s goal of achieving net-zero greenhouse gas emissions by 2050. Investment in renewable energy sources and green transportation will have to be a significant part of that plan. It’s familiar territory for Granholm, who set up programs to retrain unemployed Michigan autoworkers for jobs in technology and renewable energy during the Great Recession and has since served on the board of directors for EV charging infrastructure company ChargePoint, and Proterra, a company that builds batteries and drivetrains for commercial EVs.
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In a speech given shortly after his nomination to head the Department of Transportation, Buttigieg promised to prioritize investment in the country’s degrading infrastructure (the American Society of Civil Engineers gave American infrastructure a D+ rating in its most recent report) and on developing sustainable, climate-friendly transportation methods.
Buttigieg is sure to follow Biden’s outline for the transportation sector, which would involve spending $1.3 trillion over 10 years to rebuild the country’s infrastructure and, in the process, create “millions of middle-class jobs” for the people doing the building. Infrastructure doesn’t only mean roads and bridges. Biden and Buttigieg also intend to allocate money for electric vehicle infrastructure and mass transit, and to subsidize people who retrofit their homes or businesses to reduce the buildings’ carbon footprints. Biden, famously a loyal Amtrak patron, has promised a national high-speed rail network, and has touted public transit projects as a way to reduce emissions by making it easier for Americans to live without cars.
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As mayor of South Bend, Indiana, Buttigieg revitalized the city’s downtown with the help of public-private partnerships and an eye for multi-modal transportation. He may use the same strategies for these larger-scale projects, and could use his new influence to encourage state and local leaders to do the same.
Even if Congress demurs at a large spending bill (as they have during the previous two administrations), Biden can still influence the way we move. He is expected to push for a new agreement with automakers to raise average fuel economy standards. The Trump administration rolled back an aggressive Obama-era agreement, but automakers have stated that they’re willing to work with a Biden administration on a new set of rules.
GM Defense
Biden can direct the government to purchase hybrid or electric vehicles for its huge fleet, which includes postal service trucks and military vehicles. General Motors’ newly minted Defense unit is expecting the government to show more interest in electric and autonomous vehicles for military uses. The new administration could also increase tax credits for EVs or raise taxes on fuel, though Buttigieg’s performance this week suggests that’s not the president’s first choice. Congress hasn’t agreed to an increase in the gas tax since 1993.
Biden is coming into office with big goals that would represent a significant change in policies compared to the Trump administration. But the country is facing an enormous challenge in the coronavirus pandemic, so transportation and energy policy is likely to take a back seat in this first part of Biden’s term. And even if the government breaks ground on new transit projects or successfully encourages car companies to build EVs, Americans may still prefer driving around in their own private gas-powered cars. And if anyone on Team Biden is reading this, give us a call. We know about a few potholes that need filling.
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