Cybertruck, Tesla.
It seems that there has never been a better time than now to buy an electric vehicle in the United States, especially if you read news headlines and White House press releases. You might be forgiven for thinking that you can actually afford to upgrade your old gas-guzzling sedan with a sleek, new zero-emissions EV. And if you can’t afford one, the various local, state, and federal rebate programs will surely knock thousands off the price tag, right?
Wrong. In order to be able to qualify for the ever-changing and complicated federal $7,500 rebate on EVs, one has to be rich enough to be able to afford to buy a new EV (some used ones qualify but good luck figuring out which one, and then even better luck finding such a car available for purchase). But, in order to qualify for the rebate, one can’t be too rich. If you’re middle-income, like me, you can lease an EV, but then you don’t qualify for the rebate—your leasing company does—and you’re left paying a hefty monthly lease.
News headlines about Tesla slashing its EV prices might still convince you that a new EV is within reach—that is if you don’t mind enriching one of the worst humans on the planet. But Teslas are still among the more expensive cars on the market.
Meanwhile, there are sensationalist headlines about EV sales falling over the past year, so much so that one might be forgiven for thinking that maybe most people wanting an EV already purchased one and demand is simply weakening. Dig past the headlines however, and the news reports all come to the same conclusion: EVs are still unaffordable for the majority of Americans, especially those who simply want to reduce their carbon footprint and their financial expenses at the same time. “Pricing is still very much the biggest barrier to electric vehicles,” according to one research analyst.
A Los Angeles Times report agreed: “Although the cost of building EVs continues to drop, it has yet to reach price parity with conventional gasoline-powered vehicles.” But the paper then bizarrely blamed Americans for the high price tags, saying, “Americans’ preference for larger vehicles necessitates larger, heavier and costlier battery packs, contributing to the high prices.” There was no mention of auto manufacturers spending years aggressively marketing SUVs and other giant gas guzzlers to Americans. Indeed, there is a whole range of EV trucks on the market right now—still out of the grasp of ordinary middle-income Americans looking for an efficient commuter family car.
Too bad these consumers don’t have access to China’s new EV, the BYD Seagull, a car that test drivers in the U.S. are gushing over, and whose price tag begins at a mere $9,698. “That undercuts the average price of an American EV by more than $50,000,” explained Bloomberg. In fact, more than 70 percent of all EVs sold globally are Chinese manufactured. You don’t have to live in China to buy a Chinese EV. You just have to live outside the U.S.
What most headlines aren’t saying overtly and what the Biden administration is also keeping relatively quiet about is that the U.S. is engaging in a fiercely protectionist trade war with China in order to shield American automakers. Forget the TikTok war—it’s Chinese-made EVs that keep U.S. auto CEOs up at night.
To protect them, the Biden administration is fanning the flames of anti-China sentiment and claiming it is worried about “National Security Concerns” over the computer systems of Chinese-made EVs. “China is determined to dominate the future of the auto market, including by using unfair practices,” said Biden in late February. “China’s policies could flood our market with its vehicles, posing risks to our national security.” The president has even ordered an investigation into China’s so-called smart cars, which most EVs are these days.
But the Biden administration’s climate goals for auto emissions rely on a mass transition to EVs across the nation. Already, it’s behind in ramping up towards its goal of wanting half of all vehicles sold in 2030 to be EVs, likely because most Americans can’t afford them, or can’t access the far-cheaper Chinese-made cars. On top of that, the GOP has now made attacking EVs part of its new culture war. It’s no wonder EVs remain out of reach for most Americans.
Why are Chinese cars so much cheaper, more varied, and just better than American ones? It doesn’t all boil down to the cost of labor as one might imagine. Chinese labor costs are not as low as they used to be. China’s government has simply made EVs a massive priority. An analysis in MIT Technology Review explained, “the government has long played an important role—propping up both the supply of EVs and the demand for them,” and that there have been “generous government subsidies, tax breaks, procurement contracts, and other policy incentives.”
Instead of adopting a similarly aggressive approach to making EVs a priority, the Biden Administration’s Inflation Reduction Act (IRA) has created a complex series of tax credits that require all EV materials and labor to be sourced in the U.S.—a goal whose math just doesn’t add up. And, the IRA doesn’t even protect U.S. workers enough. The United Auto Workers (UAW) denounced the IRA on its first anniversary for failing to require fair labor standards in the transition to an EV economy.
Still, UAW did the job itself. Fresh from a major union victory in late 2023 the union won job protections from the three biggest U.S. automakers for workers transitioning into the EV industry.
Our economy relies far too much on cars and most American cities are planned around car-centric living. It’s no wonder that petroleum-powered vehicles are the single largest U.S. source of climate-changing emissions. There are many ways to reduce this source, including redesigning cities to be more walkable, improving the quality and cost of public transportation and train systems, and encouraging bicycle transportation when possible—all of which will take concerted effort, time, and resources.
But the climate clock is ticking fast. After decades of scientists and climate activists sounding the alarm and being ignored, we are only now starting to take baby steps to mitigate climate change and it’s simply not enough. Even when accounting for the mineral extraction needed to make EV batteries, EVs have a far lower carbon footprint than petroleum-based cars and are perhaps the best, most accessible tool we have to quickly reduce our carbon impact.
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