Auto Suppliers Just Realized EVs Will Cost Them Jobs

The Motor & Equipment Manufacturers Association (MEMA) has informed a Senate Commerce subcommittee on transportation that the Biden Administration’s penchant for electric vehicles is starting to get under its skin. The union is recommending that the United States avoid setting any timeline for the proposed banning of internal combustion vehicles because it might cost a staggering number of jobs.

Ann Wilson, MEMA’s senior vice president of government affairs, said vehicle restrictions were unrealistic before 2040 and would obliterate entire segments of the auto industry without providing concrete assurances that the environment would be improved. While the latter claim can be argued endlessly, the former is pretty difficult to refute.

This is something anyone paying attention to the automotive sector could have seen coming from miles away. As manufacturers began praising EVs for their simplicity and noting how they used far fewer moving parts than their gasoline or diesel equivalents, suppliers should have been asking themselves if the fuel injectors they produce will have a place in an electrically driven society.

But the answer is obviously no. Electric cars generally require fewer components and less labor to manufacture and will undoubtedly result in major changes for the workforce. MEMA estimated losing 30 percent of the supplier industry’s traditional workforce if the United States transitioned over to EVs. That’s hundreds of thousands, if not millions, of good-paying jobs. In 2020, a study by the National Platform for the Future of Mobility (NPM) informed the German government that 410,000 jobs connected with the automotive industry could be lost by the end of this decade under the nation’s current trajectory. American losses would be substantially worse.

MEMA is recommending a mixed approach where manufacturers can continue making ICE’s more efficient while developing hybrid and battery-electric models to a point where they will naturally overtake fuel-burning automobiles as the dominant mode of transportation. It’s still targeting a zero-emissions future, just one that doesn’t require placing massive restrictions on the industry.

Automakers, who stand to benefit from having to pay fewer assembly workers and equipment manufacturers, are more willing to embrace electrification and many have already set targets for ditching products requiring fuel tanks. But it’s not clear how much of that is for show. While digitizing cars plays into the industry’s obsession with monetizing driver data, electrification doesn’t seem profitable in the short term without government help and it seems to shift an incredible amount of the auto sector’s power over to battery companies and energy concerns. We’ve been under the impression that some of the largest manufacturers put on a pro-EV face and frequently support government initiatives just to avoid ruffling feathers and getting slapped with regulations.

While completely ridiculous, appeasement is a fairly common practice with plenty of recent examples. Pipefitting unions backed Joe Biden for president, despite his vow to stop production on the Keystone XL pipeline and put members out of work. So did the United Mine Workers of America, with its leadership embracing a federal energy plan that prohibits coal mining last week. Union boss Cecil Roberts even admitted that it would probably cost the industry jobs but that it was important to be part of the “conversation” and ensure the environmental wellbeing of the planet.

Meanwhile, China is on pace to build several hundred new coalfired energy facilities over the next ten years and shares our air.

UAW leadership, which traditionally endorses Democrat candidates, also backed the Biden administration. But members have been hypercritical of the push toward electrification for years and it’s been a common talking point whenever they go on strike. We’ve only seen this swell with worker’s unions around the world gradually starting to rally around the issue — though it always seems to be the highest-ranking members that are the last to join the cause.

States have also been taking sides, with roughly a dozen governors promising to adopt the Californian proposal to end the sale of new gasoline-powered vehicles by 2035. However they are not just attempting to prohibit sales within their own borders, they would ideally like to see the federal laws put into place that would create national restrictions.

“The U.S. is in danger of losing our competitive edge due to a lack of clear national policies” said Wilson. “For the U.S to be a leader in automotive innovation and transportation, we must work collaboratively to develop a comprehensive national vision and strategy.”

MEMA’s testimony is available here.

[Image: Vlad Kochelaevskiy/Shutterstock]