US Treasury Secretary Janet Yellen testifies before a House Financial Services Committee hearing on the “Financial Stability Oversight Board's Annual Report” on Capitol Hill in Washington, DC, on February 6, 2024.
Amanda Andrade Rhodes | Reuters
Treasury Secretary Janet Yellen on Wednesday praised President Joe Biden's investment in electric vehicles for accelerating the sector, even as the industry cools off its years-long hot streak.
Yellen touted Biden's electric vehicle measures in Kentucky at a new $49 million electric vehicle battery plant built by Advanced Nano Products, the battery supplier that will get tax credits from Biden's inflation-reducing law for the new clean energy facility.
“It's part of a boom in electric vehicle investments in Kentucky,” Yellen said. “Biden administration policies and federal funds are fueling private sector investment.”
The minister's optimism about electric cars comes at a time when the private sector is tempering its mood towards fully electric cars.
According to a recent CNBC report, major automakers that have eagerly set deadlines for transitioning to fully electric vehicles, such as stronghold And General Motorsis now cooling its expectations, shifting to a wait-and-see stance rather than committing to a tight timeline for EV conversion.
Investor excitement over electric cars was initially driven in part by cheap money from low interest rates, as well as Biden's inflation-reducing law, which provided tax breaks to both consumers who bought fully electric cars and the companies that produced them.
“The great American road trip will be fully electrified,” Biden said optimistically at an event in Michigan in September 2022.
However, the establishment of EV charging infrastructure has been slower than expected. Consumer demand for vehicles has not kept pace with original expectations.
Biden is now also reportedly slowing down his electric vehicle goals.
Workers with the City of Milwaukee Department of Public Works install a sign near the Pieper-Hillside Boys and Girls Club where President Joe Biden is scheduled to speak on the afternoon of March 13, 2024, in Milwaukee, Wisconsin.
Scott Olson | Getty Images
The president has made his investments in electric vehicles with the goal of making half of new car sales electric by 2030.
As part of that timeline, the EPA last April proposed its most ambitious limits on vehicle greenhouse gas emissions, which would have required electric vehicles to take a majority share of the auto market by 2032.
Officials are now working to adjust those rules to gradually increase electric vehicle production, which would extend the timeline for cutting emissions to about 2055, the New York Times reported in February.
With the November presidential election looming, Biden's aggressive push on electric vehicles has in some ways become a political liability as well.
In January, Biden received the endorsement of the United Auto Workers, a union that fears the transition to electric vehicles will leave auto workers behind.
As the self-proclaimed “most pro-union president in American history,” Biden has had to reckon with tensions between his electric vehicle goals and his labor stance.
Biden's election opponent, former President Donald Trump, repeatedly attacked Biden's all-electric targets during the campaign.
“A New Green Scam…All the electric car nerds, and much more, looking to destroy the once great USA,” Trump, a Republican, wrote in a social media post on Christmas Day.
– CNBC's Michael Wayland contributed to this report.
