Joe Biden Is Botching the Dream of Made-in-America Electric Vehicles
In the 1980s, as Japanese cars flooded the already-struggling US auto market, then-President Ronald Reagan's trade representative, William E. Brock, found a way to limit them with tariffs and import quotas. The measures eventually resulted in the likes of Toyota Motor Corp., now the world's largest car company, investing hundreds of millions of dollars to set up factories — or transplants, as they were known — across America. They churned out millions of vehicles that led to the proliferation of an efficient auto-supply chain and employed thousands of workers.
If the US plays it right, this could happen again — sans the tariffs — as it tries to build the great American electric-vehicle supply chain independent of the world's factory floor (and largest battery and EV maker), China. This time, though, the South Koreans will be joining the Japanese.
As the EV hype ramps up and a shortage of batteries emerges, industrial giants like SK Innovation Co., Honda Motor Co., LG Energy Solution Ltd., Panasonic Holdings Corp. and Toyota have announced billions of dollars of facilities across the US to manufacture powerpacks. To ensure that much of it comes from North America, some are sourcing raw materials from Canada as the nation deepens its ties with South Korea. Since the beginning of 2021, more than 15 new facilities or expansions, concentrated around the Midwest and South, have been disclosed in the US, a potential investment of at least $40 billion, according to an analysis by the Federal Reserve Bank of Dallas.
These firms are plugging a key technology gap that the US is trying to fill. State governments have welcomed them with open arms. With few US companies that can make EVs and batteries on the scale South Korea can
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