Biden’s electric car plans spark anger in Mexico and Canada

Joe Biden will meet with leaders of Mexico and Canada this week because his plan to encourage Americans to buy electric cars made in the United States has sparked strong opposition from the two major trading partners of the United States.

The so-called Three Friends Summit, which will be held at the White House for the first time since 2016, will be held when senior officials in Mexico City and Ottawa complain that Biden’s plan to start electric car manufacturing in the United States breaks international conventions. Trade rules.

The opposition of some of America’s closest allies to its flagship climate policy has created political and diplomatic dilemmas for Biden.During Donald Trump’s turbulent term, the president has pledged to reduce tensions with trading partners and use industrial policies to promote green industries, such as Electronic car manufacturing.

Although not yet passed into law, Biden’s broader $175 million legislative plan includes proposals to provide $7,500 in tax credits for electric vehicles made only in the United States from 2026. Another tax credit of $4,500 can be used to purchase electric cars made by union workers.

On Friday, Canadian Foreign Minister Mélanie Joly (Mélanie Joly) said that she raised the issue during a meeting with US Secretary of State Antony Blinken.

Canadian Trade Minister Mary Ng previously wrote to Democratic and Republican leaders as well as U.S. Trade Representative Katherine Tai and U.S. Secretary of Commerce Gina Raimondo expressing Ottawa’s “very serious concerns” about electric vehicle credit.

Ng’s office stated that Washington’s proposed measures “do not meet” its obligations under the USMCA, the latest North American trade agreement reached between the three countries under Donald Trump’s leadership, and the rules of the World Trade Organization.

Mexico’s Minister of Economy, Tatiana Clouthier, has sent her own letter to U.S. lawmakers requesting that these proposals be amended to bring them into line with the USMCA.

“This is paradoxical,” Clautier said. “They will set off more [migration] Use this measure. “

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Mr. Dai declined this week on whether the U.S. proposal violated U.S. Marine Corps As the Democratic Party’s chief trade adviser in the House of Representatives, she helped facilitate trade agreements.

“I know the concerns raised by our trading partners, and we are concerned about these concerns,” she said.

Edward Alden, a senior fellow at the Committee on Foreign Relations, said the growing dispute between the three countries is “a major event.”

“Everyone is turning to electric cars at a very fast rate, and car companies are now deciding where to locate electric car factories,” Alden said.

“This tax credit provides a strong incentive for final assembly in the United States, so it’s no surprise that Canadians and Mexicans are deeply concerned about this.”

At present, the North American motor industry supply chain is scattered in these three countries. According to a recent report from the Congressional Research Service, some auto parts cross the borders of the United States, Mexico, and Canada “seven or eight times” before being assembled into the final vehicle.

The United States imported 29.4 billion U.S. dollars worth of auto parts from Mexico, exported 5.9 billion U.S. dollars worth of parts to Canada, exported 11.7 billion U.S. dollars worth of complete vehicles to Canada, and exported 67.5 billion U.S. dollars worth of auto parts to Mexico. CRS stated that auto parts exported to Canada and Mexico are often returned to the United States for assembly into finished cars.

“It is important to remember that the automotive industry is the most typical North America, USMCA or Nafta industry,” said Tony Wayne, the former US ambassador to Mexico, referring to the USMCA’s predecessor trade agreement. “It is more integrated than any other industry.”

Canada stated that the US threat to disrupt the integration of the auto industry at this time may backfire.

Wu’s letter reminded US officials that Canada is “the only country in the Western Hemisphere that has all the key minerals needed to make electric car batteries”, and therefore Canada is “a necessary condition for the United States to realize its electric cars.” Future goals”.

Mexico’s low labor costs have long attracted automakers, but the industry The leaders are already worried In the process of shifting to electric vehicles, it may not be able to attract new investment booms.

These plans have also triggered some domestic political opposition. Senator Joe Manchin, a moderate Democrat from West Virginia, opposed the proposal to provide an additional $4,500 in tax credits for cars produced in the US factory where workers have a union.

Manchin made a key swing vote between Democrats and Republicans with a score of 50 to 50 in the Senate. During a visit to an ununionized Toyota plant in Buffalo, West Virginia, Manchin said that the extra credit is “Wrong”, “It’s not who we are”.

Biden plans to visit a GM factory in Detroit, Michigan, which produces electric cars later this week, to sell workers how his infrastructure bill will help expand the electric car supply chain and create “high-paying unions across the country.” Work”.

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