Fighting for a Just Electric Vehicle Transition
The Inflation Reduction Act of 2022 (IRA) directed hundreds of billions of dollars to the electrification of the transportation sector. On top of these new federal subsidy programs, companies that manufacture batteries and electric vehicles continue to benefit from large state and local subsidy deals as well. Much of the announced new investment in electric vehicle production has gone to Southern states, where wages are lower and far few workers are protected by a labor contract.
The IRA features a particularly generous subsidy for factories producing batteries. Some battery manufacturers stand to receive more than a billion dollars per year in federal income tax credits through the Advanced Manufacturing Production Credit, also called the 45X credit.
Additionally, our 2022 report detailed how more than 100 projects had received over $13.8 billion in state and local subsidies, which we know is an incomplete picture because subsidy costs were not disclosed for 52 projects. Six states set all-time records (at the time) for spending on individual projects. Since then, several even bigger deals have been announced.
What do local communities get for subsidizing battery- and automakers? The Biden administration says the IRA will create “good-paying union jobs,” but the 45X credit, for example, has no job quality requirements for permanent jobs and doesn’t mandate companies pay market-based wages or benefits. State subsidy packages also fail to require companies create good jobs. Good Jobs First is working with a broad coalition of labor, environmental, and grassroots groups to ensure workers reap the benefits of these historical investments of the public’s money.