Electric vehicles | Arizona, an unlikely ally for Canada

(Washington) From its arid desert climate to its sometimes unpredictable center-right politics, the state of Arizona seems to have little in common with Canada beyond the snowbirds wary of winter.

But President Joe Biden’s controversial plan to use protectionist tax incentives to promote US-made electric vehicles, which threatens Canada’s auto industry, creates all kinds of weird connections.

With its proximity to both Silicon Valley and the US-Mexico border, without the high taxes and regulations of its California neighbor, the Grand Canyon State is working to accommodate the impending electric vehicle revolution – a vision endangered by President Biden’s project.

“We’re going to be one of the next hubs in the United States for manufacturing next-generation electric vehicles,” said Chris Camacho, president and CEO of the Greater Phoenix Economic Council.

“We just want, from a federal policy perspective, a fair and balanced approach so that consumers can buy the products they want. Whether produced in states like Arizona or other states across the country, we believe that a prudent policy to influence consumer choices must be fair. ”

Arizona is far from the only state opposed to the measure, which, if passed, would allow potential buyers of electric vehicles to receive tax credits of up to $ 12,500, provided their favorite car or truck was assembled in the United States and built by unionized workers.

But few have been more vocal opponents. Last month, Phoenix Chamber of Commerce CEO Todd Sanders and Jaime Molera, the Arizona director of a conservative environmental group called The Western Way, signed an opinion piece denouncing an “evil” project. drafted ”which“ would hamper ”the State’s ambitions in terms of electric vehicles.

Mr Sanders, for his part, takes little comfort in the fact that Joe Biden’s ‘Build Back Better’ bill, the $ 1.750 billion social and climate spending program containing the tax credits, suffered a setback before. Christmas when dissenting Democratic Senator Joe Manchin said he would not support him.

“What you learn early on is that nothing is ever dead,” said Sanders, himself a veteran of public policy debates in government through the state legislature. , in an interview.

“If we can involve Canada in this project, obviously our friends in Mexico and then our delegation to Congress, it at least begins to raise concerns that this is not necessarily the right way to go. ”

In addition to promising electric vehicle players like Rivian, Nikola and ElectraMecchanica, Arizona is also attracting suppliers of parts and manufacturing services, including Jomi Engineering Group, based in Barrie, Ont., Which will have approximately 120 employees at the mid-year working at his new facility at Casa Grande, just south of Phoenix.

“You can’t fight it,” Jomi founder and president Michael Hoy said of the electric vehicle industry’s growing gravitational pull to the southern United States.

” [Nous] could no longer bank on Canadian exploitation; we probably never would have had the opportunity like we do, or to become competitive enough, if we had not been closer to our customers. ”

In October, Arizona Gov. Doug Ducey was among 11 Republican state governors who wrote to congressional leaders denouncing the Biden plan as an unfair use of taxpayer money.

“We cannot support any proposal that creates a discriminatory environment in our states by punishing autoworkers and automakers because workers in their factories have chosen not to unionize,” the letter said.

“Congress should not pass proposals that favor vehicles produced by one workforce over another, especially when doing so significantly limits consumer choice and undermines broader carbon reduction targets. ”

In a knife-edge, 50-50 split Senate, West Virginia’s Manchin has been the subject of speculation about his support for the Build Back Better plan. Less attention has been paid to an equally unpredictable Democratic colleague, Senator Kyrsten Sinema, whose moderate-conservative politics aptly sums up the purple state it represents: Arizona.

As an anti-union state – by law, employees cannot be compelled to join a union – with a vested interest in a robust and growing electric vehicle industry, Arizona is solely focused on removing the $ 4,500 portion of tax credits that focus on vehicles assembled in the United States and built by unions.

“That should make him almost the optimal ally,” said Roy Norton, a former senior diplomat who spent two stays at the Canadian Embassy in the 1990s and 2000s before becoming a diplomat in residence at the Balsillie School of International. Affairs in Waterloo, Ontario.

“We don’t want to kill the subsidies. We just want to remove subsidies for vehicles made in the United States exclusively, and Arizona should be on precisely the same wavelength as it is an anti-union state that is at odds with a president. and an administration that is a bit of a step backwards. ”

Officials in Ottawa confirm that the Arizona congressional delegation, and Mr.^me Sinema in particular continues to be at the center of the federal government’s lobbying efforts, which culminated late last year with visits to Washington by several envoys, including Prime Minister Justin Trudeau.

President Biden, however, does not hide his affinity for unionized workers or his ultimate goal of restoring the former luster of the once powerful US manufacturing sector. Both, along with reducing carbon emissions, are the main goals of a tax credit program that the White House says is close to its heart.

While he did not specifically mention the electric vehicle tax credits, Mr Biden himself strongly signaled on Friday that he had not abandoned the Build Back Better bill, which is expected to come back to the government. foreground in the weeks or months to come.

Whether it will continue to include tax credits or whether the vision for electric vehicles will take a different form remains unanswered.

Commenting on the latest US employment figures, the president reiterated Friday his vision of a resurgent US manufacturing sector, fueled by an economy growing “from the bottom up and through the middle.”

“From day one my economic program was different. It’s about taking a fundamentally new approach to our economy – one that sees prosperity for working families as the solution, not the problem, ”he said.

“Let’s ensure that what we sell in the United States is made in the United States, so that we do not put ourselves at risk for delays in deliveries from foreign supply chains. ”