Republican Asks for Section 232 Investigation on Electric Vehicles
A House member who is running for the Senate in Indiana asked the Commerce Department to initiate an investigation on the import of electric vehicles and electric vehicle batteries made anywhere in the world.
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The Commerce Department's Bureau of Industry and Security already began a rulemaking process to consider whether information technology used in connected vehicles poses an "unacceptable risk to the national security of the United States or the security and safety of United States persons" when those technologies are made by firms in a "foreign adversary," which includes China (see 2402290034).
Rep. Jim Banks, R-Ind., announced March 18 that he'd requested a Section 232 investigation, saying: "Joe Biden staked America’s national security and our entire auto industry on the success of his EV transition, and right now China is eating our lunch. The White House must either let go of its green energy dreams or respond to China’s predatory EV trade practices. Sleepwalking towards disaster will cost tens of thousands of Hoosier autoworkers their jobs and cripple our defense industrial base."
He wrote to the administration saying that about a half-million "Americans are employed in manufacturing jobs to produce internal combustion engine vehicles. This administration’s EV transition risks eliminating countless numbers of these positions, while costing U.S. taxpayers and the federal government additional billions in subsidies and tax credits.
"That said, because your administration has decided to force EVs upon the American automotive sector and on American consumers, you must also ensure that these vehicles are made in the United States. The American auto industry is a linchpin of economic growth and industrial innovation, both of which are crucial for U.S. national security."
Banks quoted the 2019 Section 232 investigation on imported automobiles, which resulted in no action on imports. That report said: “the strength of the United States’ automotive manufacturing sector has directly contributed to the industrial base that provides the economic strength and technological innovation that enables our armed forces to project military power and maintain our status as a world power."
Banks noted that China is responsible for 35% of global EV exports, and that it's the largest exporter of cars (though he didn't note that 60% of those cars are traditional ICE vehicles.)
He said that one in three EVs globally is powered by a CATL battery, a Chinese company that he said has "deep ties to the Chinese Communist Party."
Banks, who sits on the House Select Committee on China, said a global restriction on imported EVs or batteries is imperative because Chinese batteries are incorporated in EVs made in the U.S. or other countries other than China. He said China frequently is performing most of a product's manufacturing steps in China "then shipping the product to a third country for relatively minor finishing steps, allowing the product to claim origin in the third country instead of China."
He said if the EU imposes trade remedies on Chinese EVs "those restrictions will likely only encourage Chinese automakers to double down on circumventing U.S. tariffs. In either scenario, the U.S. industrial base will be threatened by China’s dominance of the global EV market."