The first car dealer ever elected to the U.S. Senate says the Trump agenda for the U.S. auto industry is one that, if enacted, would upend the strategy Detroit's automakers have spent billions of dollars pursuing: The transition to electric cars.
For one thing, Republicans will look to freeze fuel economy standards for at least a decade — which would slow EV adoption and anger environmentalists. A second Donald Trump administration may also look to take away California's ability to set its own strict emissions standards. Also, it is likely to repeal parts of the Inflation Reduction Act, including the $7,500 tax credit consumers receive now toward the purchase of an EV, a benefit that's helped the Detroit automakers sell the cars.
Trump's agenda could also include rewarding companies with big tax breaks if they build cars in the United States. These initiatives were laid out to the Detroit Free Press in an exclusive interview with Bernie Moreno, a former car dealer who won election Tuesday to the U.S. Senate from Ohio. Moreno said he and Trump, who endorsed each other, have discussed the industry and "I think we are on the same page here."
Moreno touched on several topics, most notably his issue with automakers pushing out EVs to meet what he said are unrealistic government fuel economy standards. That, he said, is causing sky-high prices for gasoline vehicles so companies can offset the billions they are losing by producing EVs. According to Kelley Blue Book, the average transaction price for a new vehicle in the U.S. was $48,397 in September.
"Anybody who even has a (basic) understanding of how the automobile industry works in America would tell you that the secret sauce is the marketplace," Moreno said Thursday, noting that sales signal to automakers what consumers want and don't want.
"But for the first time in automotive history, car companies decided, 'We’re not going to pay attention to our customers. We’re going to pay attention to our political leaders and make cars people don’t want,' " Moreno said. "The money that has been wasted and lost in this … move to electric vehicles is just absolutely insane. Ford has lost billions of dollars trying to pacify political leaders that were completely unqualified to be giving any kind of advice.”
Ford's EV division, called Ford Model e, lost $1.2 billion in pretax profits during the third quarter and is expected to lose about $5 billion by the year's end.
Moreno, the first car dealer elected to the Senate, is a 1989 graduate of the University of Michigan with a bachelor's degree in business administration.
He said he and President-elect Trump share the same vision for overhauling the American auto industry: They want to create more jobs, bring down prices of new vehicles, repeal many of the environmental regulations that are driving automakers' aggressive EV push and keep foreign-built cars offshore with high barriers to entry.
The plan includes lowering energy prices and incentivizing automakers to shift all manufacturing to the United States.
"We’re going to have an American energy and American automotive renaissance in this country unlike anything you’ve seen," Moreno said.
