The future of the electric vehicle is a critical issue for the U.S. auto industry and its home base of Detroit, Michigan. It’s also increasingly becoming a political issue, according to Michigan Gov. Gretchen Whitmer.

The Biden administration’s support of EV adoption includes the Inflation Reduction Act, now at odds with Donald Trump’s promise to remove fuel economy mandates if he is re-elected, a policy reversal that could extend the era of gas-powered vehicles.

“We’ve seen politics bleed into this space,” Whitmer said at the CNBC CEO Council Summit in Washington, D.C., on Tuesday. “Yes, we should say [research and development] is a good thing and setting the pace in the world is a good thing, but it is complicated right now like everything is.”

Whitmer, who has supported several EV-focused policies, including making all state government vehicles fully electric by 2040 and rebates that would encourage EV sales, said the auto industry understands the right strategy.

“The world is moving fast and our OEMs are being more nimble and embracing this. … We don’t take [internal combustion engine cars] off the menu of what we can offer, but until we build up the [EV] infrastructure, we know there’s going to be fits and starts, but it’s moving in the right direction,” she said.

Automakers, who spent much of the last few years pushing EVs heavily, have started to lower expectations, matching a decline in interest from consumers. Political pressure from either side in the next term could alter that.

“Everything is politicized in this moment. It’s an unfortunate part of where we are right now as a country,” Whitmer said.

In the long term, the EV investment curve is tied to broader national goals on manufacturing, as well as economic and national security, which Whitmer pointed to as a sign of strength.

“For the first time in a real long time, we’ve got a real strategy as we look to rebuild manufacturing in this country, and we saw during the pandemic how bad it was on so many fronts, not just on the jobs but on homeland security,” she said. “We’ve got to have manufacturing growth in this country and it’s happening with a sustained and real focus … Making sure we are building the cars of the future is an important part of that security, and good paying jobs, and supporting an industry that is trying to move fast is in all of our interest.”

Whitmer, a Democrat who said she grew up in a household with a Republican father and a Democratic mother, spent her first term as governor in 2018 in the minority across the state, and even as Michigan shifted left in more recent years, the state still has several Republican stronghold districts.

“I think it’s important that we teach people to ask questions to try to take in as much information, whether sitting across the table from someone with very different politics or a very different set of experiences,” she said.

CNBC “Squawk on the Street” co-anchor Carl Quintanilla asked Whitmer if that approach makes it hard to stay true to her principles.

“I don’t think [listening] changes your values, but you always have to be able to learn and to understand what’s going on,” Whitmer said.

She first ran for governor with a promise to fix the state’s roads, a goal that came out of conversations she had with people from both parties and what they said would make their lives better.

She voiced support for an energy policy that has not been popular on the left in recent history but has received renewed attention nationally.

“We’re going to meet our energy goals and our climate goals and nuclear is an important part of the equation. Do you think the public is ready to talk about nuclear again? I wasn’t sure what to expect but in the community, we’ve seen great support,” she said.

“These are good-paying jobs, they are intertwined with our clean energy goals and having energy independence which is crucial for our economy and security and we’ve gotten a lot of positive feedback,” Whitmer continued. “There is a generation that is uncomfortable but most of it has been positive.”   

Whitmer acknowledged that sticking to her principles has opened her up to criticism, but that’s inevitable right now.

“One of the things that I’m always acutely aware of is that in this environment, no deed goes uncriticized,” Whitmer said. “Once I accepted that, it’s been liberating because it frees me up to not try to anticipate how we make everyone happy because it’s an impossible task.”

“I think some of this might be paralyzing if you were trying to make everyone happy; forget it,” she said. “You’re not going to be able to do it. Do the next right thing, on behalf of your employees, on behalf of your employees, on behalf of your community.”

Source link: https://www.cnbc.com/2024/06/04/politics-playing-a-role-in-ev-adoption-michigan-gov-whitmer.html