Manchin’s EV legacy
— Sen.
— Welcome to another week of government shutdown drama.
— Some UAW workers reject the tentative contract deal with GM, though voting continues through November.
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“I’m gonna wake you up early cause I’m gonna take a ride with you./We’re goin’ down to the Honda shop, I’ll tell you what we’re gonna do./Put on a ragged sweatshirt, I’ll take you anywhere you want me to.”
SENATORS COME AND GO, EVs ARE FOREVER: Manchin is punching out, but the electric tax credit he engineered — and then opposed — will live on. Manchin (D-W.Va.), who announced last week that he’s not running for reelection, stopped Democrats in 2021 from passing the Build Back Better bill and then negotiated with Majority Leader Chuck Schumer on a narrower bill focused on clean energy. Manchin has never been a fan of subsidies for electric vehicles, saying it’s “ludicrous” to pay people to buy vehicles they want to buy. The tax credit he eventually agreed to would have the twin knock-on effects of onshoring the supply chain for EV batteries — something just about everyone agrees is a positive development — as well as the less favorable effect of severely narrowing the universe of qualifying cars, at least for the short term.
Playing by Manchin’s rules: While Manchin insisted on limiting the tax credit to vehicles with battery minerals and components from the United States or U.S. trading partners, he didn’t agree with limiting it, and other related clean energy incentives, to companies with unionized workforces, saying it was “not who we are as a country” to “use everyone’s tax dollars to pick winners and losers.” That stance ended up getting Biden in trouble with union allies, which was on especially prominent display in the run-up to the United Auto Workers strike on the Big Three.
Regrets: Manchin has spent much of the 15 months since the Inflation Reduction Act’s passage railing against how it’s been implemented. He was furious when content sourcing requirements were delayed by three months to give Treasury more time to finish the guidance. He has threatened to sue the administration over the law’s implementation, criticizing Biden’s team for allowing a loophole that exempts leased vehicles from the battery rules and crafting narrow trade agreements with non-free trade partners to allow other countries to supply battery minerals. He’s also disagreed with the way Treasury decided to calculate mineral content for the purposes of the law.
Into the future: The rapid restructuring of the automotive supply chain to bring manufacturing to the United States and friendly nations, if successful, will long outlast Manchin’s Senate tenure. And liberals who have spent the last 12 years considering Manchin a Democrat-in-name-only might find themselves sorry to lose him if Democrats end up ceding the Senate in a tough 2024 map.
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TWO STEP: House Speaker Mike Johnson’s plan to fund the government that took shape over the weekend quickly ran into resistance from some Republicans, our Congress team reports, with two different funding deadlines for different parts of the government. Unless Democrats buy into the idea, a shutdown is increasingly likely.
Johnson told lawmakers over the weekend he intends to bring up the plan for a vote on Tuesday, though its chances of passage seem low unless Democrats announce they’ll support it. Under Johnson’s spending plan, Agriculture, Energy and Water, Military Construction and Veterans Affairs, and Transportation and Housing and Urban Development would be funded until Jan. 19. The other eight funding bills, which include some of the biggest spending headaches like a fight over the FBI, will run until the Feb. 2 deadline.
A reminder: A shutdown would stop air traffic controller training at a time of ongoing staffing woes, while fully trained air traffic controllers and TSA baggage screeners would show up to work without pay.
TWO PILOT TALK: Delta Air Lines CEO Ed Bastian, at the end of a CNN interview last week, said: “I will never get on a plane unless there’s two Delta pilots, at least two Delta pilots.” His comments, which also included that while technology is important “you can never replace human judgment in a business like Delta” drew praise from the Air Line Pilots Association.
ALPA, which has been raising awareness against efforts, mostly in Europe, to potentially lessen the number of pilots physically inside a cockpit, said: “We’re glad to see the @Delta CEO agrees.” ALPA started a campaign called “Safety Starts With Two” along with their European counterparts, hoping to take their argument straight to passengers who might also find the idea alarming. So far, the FAA isn’t considering any proposals to reduce the number of pilots, but U.S. pilots worry that competitive pressure would force U.S. airlines to follow suit if Europe takes steps to reduce the number of pilots from two to one on many flights.
WARNING SIGN: United Auto Workers members at multiple General Motors facilities have voted against the union’s tentative contract agreement with the company, Nick Niedzwiadek reports, one of the first meaningful signs of concern since the union called off its work stoppage. UAW Local 598, which represents workers at GM’s assembly plant in Flint, Mich., posted on Facebook that just shy of 52 percent of ballots were against ratifying the four-year agreement brokered by union leaders and GM. At least three other GM facilities have also voted against the contract terms, according to a tracker maintained by the union.
The ratification votes are a major test of members’ faith in UAW President Shawn Fain, who has repeatedly said he believes union negotiators extracted “every last dime” they could out of the automakers. Voting across local UAW chapters at all three automakers is expected to continue throughout the month.
RESIDUAL EFFECTS: Honda announced Friday that its auto workers in the U.S. would receive an 11 percent raise on Jan. 1, the latest fallout and win for workers after the UAW reached tentative deals with Detroit’s Big Three automakers that included pay raises. Honda employs about 17,000 workers at eight auto plants in the U.S., with a majority located in Ohio.
TESLA LEFT OUT: Tesla wasn’t included in the European Commission’s list of companies that are being investigated in a probe of China’s subsidies for electric vehicle companies. If it is excluded, Tesla’s lawyers argue, the U.S. electric vehicle giant could find itself unfairly targeted by countervailing duties imposed on the basis of Chinese subsidies awarded to other companies. Instead, the Commission picked three Chinese carmakers: BYD, SAIC and Geely.
Matthias Schmidt, an independent automotive analyst, said the move could be a way to force Tesla to build more cars in Europe. The Model S is produced just outside Berlin, while Model 3 Teslas are made in China.
“This may be a way of showing them to divest in China and reinvest more production in Europe, creating some much needed jobs in Europe,” Schmidt said. “This would be a call to Tesla to shift European Model 3 production from China to Europe.” Our European transportation team has more.
David Bonine, who is currently serving his last day as special assistant to the president for legislative affairs, will join United Airlines as managing director and head of congressional affairs. He’ll report to Terri Fariello, executive vice president of government affairs and global public policy.
— ‘Is this hell?’ The pilot accused of trying to crash a plane tells his story. The New York Times.
— White House tried, and failed, to persuade Manchin to make another Senate run. POLITICO.
— Now that cars are like smartphones, we don’t really own them. The Washington Post.
— The best place to shop is other people’s lost luggage. The Washington Post.
— Taylor Swift’s postponed Argentina show prompts airline to waive flight-change fees. CNBC.
Source: https://www.politico.com/