Unions, advocacy groups push Senate to keep EV tax credits

Washington — A group of more than 60 unions, environmental groups and other advocacy organizations urged the Senate Wednesday to retain controversial electric vehicle tax credits that would give a boost to unionized auto workers. 

The proposed tax credit included in Democrats' Build Back Better bill would give consumers up to $12,500 off an electric vehicle, including $4,500 for vehicles made in the U.S. for companies with collective bargaining agreements.

The provision — authored by Michigan Rep. Dan Kildee of Flint Township and Sen. Debbie Stabenow of Lansing — would favor the Detroit Three, which are the only U.S.-based automakers with unionized workforces. 

The group, which included the United Auto Workers and the AFL-CIO as well as environmental groups such as the Sierra Club and Union of Concerned Scientists, argued in a letter to senators that the proposal would incentivize high labor standards in the transition to electric vehicles, strengthen the economy, and push companies to keep manufacturing in the United States. 

"The collective bargaining bonus in the (Build Back Better Act) acknowledges and rewards companies who invest more in workers, and spurs improvements in wages and working conditions that benefit union and non-union workers alike," the groups wrote. 

Union workers earn higher wages and get better benefits than non-union workers, they argue, and the credits will help push automakers to re-shore manufacturing and reach collective bargaining agreements with workers to take advantage of the full consumer credits. 

Automakers globally are pouring billions into transitioning their fleets from gas- and diesel-powered vehicles to electric ones. The United Auto Workers has been supportive of the transition, but has cautioned that changes should come with protections for workers, as EVs require fewer parts and people to assemble and maintain. 

The proposal has faced fierce opposition from trading partners Canada, Mexico and the European Union, which argue it discriminates against imports from their countries and could impact trade deals, and from foreign automakers, who say it unfairly harms American workers who choose not to join a union. 

But perhaps the critical voice with the most sway has been Sen. Joe Manchin, D-West Virginia, who has called the proposal "wrong" and "not American."

Manchin is a crucial swing vote in the evenly-divided Senate and has immense power over the final form of the Democrats' proposal. West Virginia is home to a plant operated by Toyota Motor Corp., which has been a vocal advocate for stripping the provisions from the bill. 

The Biden administration has stood by the tax credit provisions and has not indicated any changes are coming.

However, negotiations between Manchin and others on Capitol Hill continue — and it remains to be seen whether the provisions will survive a procedural hurdle in the Senate determining if they can be included in the final version of the bill. 

rbeggin@detroitnews.com

Twitter: @rbeggin