More than 100 members of Congress push Pelosi to keep EV tax credit helping unions

Riley Beggin
The Detroit News

Washington — More than 100 Democratic members of Congress, including all seven of Michigan's Democratic representatives in the U.S. House, urged Speaker Nancy Pelosi on Tuesday to retain EV tax credits that favor automakers with a unionized workforce in their social spending plan.

The massive package aimed at expanding the social safety net and combating climate change currently includes legislation from Rep. Dan Kildee, D-Flint Township, and Sen. Debbie Stabenow, D-Lansing, that would eliminate the automaker cap on EV credits and implement a $7,500 point-of-sale consumer rebate for electric vehicles. The bill would also pay out an additional $4,500 for vehicles assembled in a union facility and $500 for vehicles using a battery manufactured in the U.S.

In this Aug. 18, 2020 file photo, U.S. Rep. Tom Suozzi, D-N.Y., addresses the media during a news conference, in the Queens borough of New York.

The group, led by Rep. Thomas Suozzi, D-New York, argued that union workers earn more than their non-union counterparts and are more likely to have paid sick days and health insurance. 

"The Build Back Better Act's credit for EVs demonstrates America’s leadership in the global EV market by accelerating innovation and manufacturing in the U.S., bolstering the sector’s domestic supply chain, and creating jobs with good pay and benefits," Suozzi wrote in the letter. "We urge you to ensure that the credit remains as-is when the bill moves to the House floor."

The legislation passed the House Ways and Means Committee last month and remains in Democrats' proposed spending plan, which is likely to be pared down as congressional leaders and the White House seek a compromise on the package that faces opposition from a few key moderates. 

The United Auto Workers praised the letter Tuesday, saying that "the House members who signed this letter are standing up for UAW members and America’s middle class by helping to ensure that our investment through tax credits in electric vehicles lead to good paying union jobs in the United States. If we invest in future jobs, we need them to be good paying union jobs right here in America

The union incentive has faced fierce opposition from Republicans in Congress, and from major foreign automakers and Tesla Inc., which do not have unionized workforces in the United States.

Auto plants owned by General Motors Co., Ford Motor Co. and Stellantis NV in the U.S. are unionized by the United Auto Workers. The three Detroit-based companies and the union all support the tax credit plan, as well as environmental groups such as the League of Conservation Voters, the Environmental Defense Action Fund and the Sierra Club. 

Late last month, executives at 12 major foreign automakers — including Honda Motor Co., BMW AG, Hyundai Motor Co., Nissan Motor Corp., Volkswagen AG and Toyota — signed a letter to Pelosi urging her to reject the extra credit for union-made EVs. They argued that the proposal would limit consumer choice and get in the way of reaching the president's carbon-reduction goals.

"This would unfairly disadvantage American workers who have chosen not to join a union and produce more than half of all vehicles in the United States and the vast majority of American-made EVs," the automakers wrote. The group has also taken out ads in Washington, D.C,. and in auto manufacturing states around the country to oppose the plan. 

Stephen Ciccone, group vice president of Toyota North America, said in a statement Tuesday that House members "who support giving $12,500 to people who can afford a $75,000 electric car are discriminating against thousands of American auto workers and passing on priorities of higher importance” such as health care and paid family leave. Tesla CEO Elon Musk earlier wrote on Twitter that the package was "written by Ford/UAW lobbyists.”

In this March 14, 2019, file photo Tesla CEO Elon Musk speaks before unveiling the Model Y at Tesla's design studio in Hawthorne, Calif.

Kildee, who has led the proposal in the House, has argued that non-unionized automakers will still benefit from receiving an unlimited number of consumer credits — currently, there's a 200,000-vehicle cap, which has pushed General Motors and Tesla out of the running for the incentive. 

He told The Detroit News in September that he would be open to tweaking the union provision if he can find language to reward companies with very high labor standards, but said "it's been a difficult path" to pinpoint language he and his colleagues can agree upon. 

Still, both Kildee and Stabenow told The News last month that they stand by the union provisions in the package. 

"I'm not going to apologize for the fact that we think labor-union supported workers should go to the front of the line," Kildee said. "They helped build the middle class, we want to keep it that way. If we invest in jobs that have good wages, good benefits, good workers protections, that benefits everybody."

Twitter: @rbeggin