Electric vehicle tax credit is “catastrophically stupid,” says new Ohio senator and “car czar” Bernie Moreno – NBC10 Philadelphia

• Bernie Moreno, the former car dealer who is now Ohio’s senator-elect, is seeking to establish himself as the Senate’s “car czar” under the second Trump administration.
• Moreno said Wednesday at the CNBC CFO Council Summit in Washington, D.C. that he does not support the $7,500 electric vehicle tax credit created by the Biden administration, preferring instead to let consumers and automakers decide which cars they buy or build .
• The expected shift to electric vehicles has largely failed to materialize, and as electric vehicle sales continue to improve, automakers are now shifting their plans to a more balanced vehicle lineup that includes electric vehicles alongside hybrid and gasoline vehicles.

Republican Sen.-elect Bernie Moreno, who made his living as a luxury car dealer before running against and defeating Democrat Sherrod Brown in the major industrial state of Ohio, said he is aiming to become the Senate’s “car czar” for the next Trump administration.

If Moreno takes on that role, one of his first goals would be eliminating the tax credit of up to $7,500 that can be used to purchase or lease an electric vehicle.

“Ultimately, the $7,500 stimulus is catastrophically stupid,” Moreno told CNBC DC correspondent Emily Wilkins on Wednesday at the 2024 CNBC CFO Council Summit in Washington, DC.

Some senators, such as Elissa Slotkin of Michigan, who has been criticized by her Republican challenger Mike Rogers for supporting the Biden administration’s adoption of electric vehicles, have tried to portray their support of the tax credit as a defensive move by the auto industry to help in their fight with Chinese car manufacturers.

However, Moreno told Wilkins he thought that position was “nonsense,” adding that the government “shouldn’t tell companies what to do and how to strategize.”

“If you don’t care what kind of car you drive, then let the markets work,” Moreno said. “We’re going to let the market decide what kind of cars people should drive, and if it’s electric, that’s great.”

Moreno pushed back against the argument that eliminating Inflation Reduction Act incentives like the electric vehicle tax credit would effectively hand over a key technology race to China. He said that if China is “significantly ahead of us in electric vehicles – then that’s good for them; We are significantly ahead of them when it comes to combustion and hybrid vehicles.”

“Where would we like our industry to develop as a country? Where do we have a strategic advantage and not cede an industry to China?” Moreno said. Moreno added that a change in U.S. legislation regarding electric vehicle incentives is “not a confidence move” but a reflection of “that consumers have spoken.”

“There has never been a case where consumers have been clearer about what they want and what they don’t want,” Moreno said. “There are people for whom electric cars are great and for whom they are good. The car works for them. They should go out and buy it…But for a lot of people, they don’t want it.”

The euphoria surrounding electric vehicle investment and sales has largely dissipated among major automakers, and automakers from Ford Motor and General Motors to Mercedes-Benz, Volkswagen, Jaguar Land Rover and Aston Martin have announced plans to scale back some electric vehicle plans or to move.

While electric vehicle sales are expected to continue to rise in the coming years, the boom in consumer demand for electric vehicles that many automotive CEOs expected never materialized. “What we saw in ’21 and ’22 was a temporary market surge where demand for electric vehicles really took off,” Marin Gjaja, chief operating officer of Ford’s EV division, told CNBC earlier this year. “It’s still growing, but not nearly as fast as we expected in ’21 and ’22.”

Instead, automakers are shifting their focus to a more mixed vehicle lineup, with a range of gasoline-powered cars alongside hybrid and electric vehicles, rather than plans like the 2035 all-electric vehicle mandate outlined by GM CEO Mary Barra.

“We’re going to let the market function,” Moreno said. “We will create an environment where automotive companies can have a good tax environment, a good regulatory environment and a good workforce…Let the market work; stop the madness of government intervention in businesses, and the market will take care of it.”