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President-Elect Joe Biden EV Plan Pays You To Buy A New Car-Here’s How

Now that the dust has settled and Joe Biden is the President-elect we can take a deeper look at some of his plans for us. These include things specifically-related to the auto industry and possibly your next car or truck. One of them is the Biden EV plan that pays you to buy a new car.

Biden proposed giving cash for Americans to trade in their gas vehicles for US-made EVs

A “Cash-for-Clunkers” 4-wheel-drive vehicle sits in a dumpster outside Koons Ford in Baltimore, Maryland, August 10, 2009, advertising that they are participating in the program by the US government | Getty

Back in 2009, the “Cash For Clunkers” stimulus gave discounts to those trading in older polluting vehicles for new cars. Biden’s plan is similar. He has proposed giving cash vouchers for Americans to trade in their gas vehicles for US-made EVs. The timing couldn’t be better.

American car companies have been hammering out EV models in most segments including trucks. With such a low percentage of vehicles sold being EVs, many asked why? Why so much effort for so small of a segment. Well, with a stimulus to swap gas-powered vehicles to EVs the percentages should ramp up exponentially. 

“A Democratic program probably would be more aligned with our worldwide strategy, which is really to fight climate change, to become electric,” Volkswagen Group CEO Herbert Diess said during a Bloomberg News event last week. However, he also said that Volkswagen had established “really a trustful relationship with the Trump administration and government.” 

Part of the Biden plan is to invest in 500,000 EV charging stations

Tesla model 3 cars charging in a parking garage
Teslas charging in a parking garage | Getty

Part of the car swap plan includes a $2 billion climate plan. Part of that is to invest in 500,000 EV charging stations. So the ramping up of EV sales also includes manufacturing and labor jobs for infrastructure. The investment would be a “huge benefit” for companies making EVs, but gridlock could impede the pace, said Mark Rom, associate professor of government and public policy at Georgetown University’s McCourt School of Public Policy to Automotive News.

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“If you don’t have that kind of infrastructure, that will certainly slow down our transition to an EV fleet just because it’s hard for companies to finance that,” Rom said. “This is one of those areas where, for the industry to thrive, government infrastructure seems pretty vital.” 

If those are not the goals of the Republican majority in the Senate …

Electric car charging
Electric car charging | Getty

“It’s the power of the purse,” said Kristin Dziczek, vice president of industry, labor, and economics at the Center for Automotive Research in Ann Arbor, Mich. She told Automotive News, “They’re going to have to come to compromises on spending, and if those are not the goals of the Republican majority in the Senate … then those spending targets may be scaled back.”

We know that Biden will pursue more stringent vehicle fuel-efficiency standards. These would look similar to the Obama-era targets. He’s also expected to call off the litigation with California’s Air Resources Board. This was initiated by the Trump administration to attempt one emissions target for the whole country. 

Automakers selling in the nation’s largest auto market and world’s fifth-largest economy would need to sell more EVs than it currently does. And that takes us back to the EV vouchers. Cash incentives have a way of increasing sales of whatever the vouchers are for. Put some cash in Americans’ pockets and they’ll spend it.