Detroit Regional Chamber > Detroiter Magazine > Politics Places America’s Global Mobility Leadership at Risk

Politics Places America’s Global Mobility Leadership at Risk

September 8, 2022

Political polarization touches every aspect of American life today. Apparently, nothing is immune from becoming a political football. In many cases, arguments in the public square are made from an ideological – or even worse – a ‘tribal’ perspective. Rationality and fact need not apply.

The debate about transitioning to a more electrified vehicle fleet is no doubt caught up in this political polarization. Those on the political left tend to overlook the substantial hurdles for wide scale adoption and portray electric vehicles (EVs) as a panacea for our environment. Those on the political right downplay the impact of our changing climate on our environment and economy and argue that since EVs are not ideal today, they never will be. Others dismiss EVs simply because liberals seem to like them.

The political extremes miss the most important point: A successful transition of our mobility fleet to electric is absolutely critical to the future of the American economy – specifically the Michigan economy.

THE AUTOMOTIVE/MOBILITY INDUSTRY IS ARGUABLY THE MOST VALUABLE

Every other nation on the planet is trying, has tried, or seeks to try to develop an automotive industry. The reason is: More economic value is created by the automotive industry than any another. The research and development, engineering, design, manufacturing, marketing, sales, and services associated with the automotive industry create more economic output and create more jobs than other industries.

While the United States (and Michigan) has been a dominant player in the global mobility industry since its inception, our leadership position is not a birthright.

The balance of the industrialized world, including China – the world’s largest automotive market – are leading the charge toward EV adoption using a combination of government mandates and incentives as well as leveraging higher consumer concern of environmental issues compared to their U.S. counterparts. While some Americans may find this anti-free market, it does not change the fact that the global automotive market is being pushed and pulled into an EV future.

The risk to the U.S., particularly Michigan, is being the last market clinging to the internal combustion engine (ICE) as our primary mode of transport. If that happens, U.S.-based automotive companies will be put at a tremendous competitive disadvantage by having to serve a regional ICE market and global EV market while the rest of the global industry focuses on EVs. This would be especially troubling for Michigan’s economy should we miss the opportunity to transition our companies to the EV marketplace before it’s too late. Without our automotive industry, Michigan’s economy would be in a world of hurt for generations.

HOPE IS NOT A STRATEGY

While we will not run out of fossil fuels tomorrow, we eventually will run out or extracting it will incur an even greater financial and environmental cost that even climate change deniers must acknowledge.

The trends are increasingly clear – EV adoption is poised to skyrocket. Consumers are expressing more interest, the number of compelling EV products coming to market is multiplying – and more and more people are finding their way into their first EV experience.

Those who are sour on EVs are those with little or no experience with them.  True, EVs are not for everyone today – and there may be segments of the market that may never transition to EVs.

But for everyone else, they may have an experience similar to mine.  I’m a car guy. I love my high-horsepower cars.  In 2021, we leased our first EV – an impulse purchase. Despite having other ICE-powered cars, we fight over our EV, which led to the purchase of another. Once you start driving an EV you get hooked quickly – it’s just a better driving experience. Scores of consumers are coming to the same realization and the primary motivation for an EV purchase may not be a desire to save the planet, but a desire for a better driving experience.

Let’s not allow politics to detract from the importance of maintaining our global mobility leadership, and recognize that it is increasingly an electrified one.

Sandy Baruah, President and Chief Executive Officer, Detroit Regional Chamber