Last Updated on March 15, 2024 by Umer Malik
When Joe Biden took oath in the White House in the beginning of 2013, Tesla was an upstart EV manufacturer and everyone thought it would not dominate the conventional automotive giants. And now that Biden has become a president, Tesla’s value is 5 times greater than General Motors, Ford and Fiat Chrysler combined. This mammoth success achieved by Tesla was done within a decade. Therefore, it is obvious that the future of the car industry is always unpredictable. However, one can still observe and guess which is what this article will be about! If you want to Sell car in dubai , head over to CarSwitch website.
Without a doubt, technology has taken up all aspects of our lives. Customers are demanding electrified vehicles and a sustainable future. Considering these factors, Biden has decided to restrict the country’s focus on gasoline engines and shift to fuel efficiency and climate standards.
As the future policies are introduced, American automakers and factories will take advantage of required understanding of how to invest and be ready for the shift to electric vehicles.
After sitting behind Asia and Europe in the previous years, the American car industry will receive another opportunity to transform into a global pioneer of electric vehicles technology. Resultantly, this scenario will create bigger chances for investors whereas the companies and suppliers will face a challenge to adapt to new models.
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Dramatic changes
The president has noticed that changes will probably be seen quickly under his rule. Being the son of a dealership manager, Biden is familiar with the customer base and car industry. And while it might be a bit controversial among companies, he has promised to rejoin the Paris climate accord.
This will demand Washington and the market to come back to bold emissions-reduction goals. Moreover, Biden is expected to widely utilize the executive instructions to set tougher environmental standards and motivate policies which urge the uptake of EVs.
For instance, these measures could consist of widening tax credits for electric vehicles purchases, strengthening fuel efficiency needs and shifting the public transportation to EV. Biden’s plans demand an installation of 500,000 vehicle charging stations.
The American automotive industry is more ready to adapt. This is because all the technological hurdles have been solved and the market’s industry consensus that the global pace towards an electric future is certain. To solidify this fact, 30 latest electric vehicles will be launched by General Motors in 2025.
When Obama’s presidency confirmed an agreement with the huge automakers in 2012 about new fuel economy standards, a mixed reaction was received in the big car industry. However, this time around, the GM automaker announced a $7 billion advancement of its electric vehicles investment project.
Perhaps the biggest hurdle for the market will be struggling to shift to the latest models while a big chunk of capital is still latched onto former technologies.
In 2030 alone, factories and automakers will appear dramatically different, relying on the truth that electric vehicles require widely unique and lesser parts than present vehicles. Factories will have to enact a balancing act to flow strategic energy, capital and ability into aspects which won’t necessarily be making profit immediately.
This will obviously maximize the pressure on midmarket suppliers which will make them extinct or be changed in 10 years.
Hurdles ahead
Legacy suppliers experience the issue of how to search and combine latest technology without spending big expense- or ruining the creativity they hold in the procedure. In opposite, new tech giants will have to search methods to increase manufacturing and be competitive with automotive volumes without compromising the quality, which is a never ending issue for newcomers in the industry.
Creative operational procedures will be required to concentrate not just on how to practice the innovation, but how to develop its market status to sell the latest tools. The demand for fast market evolution is initiating the impulse toward acquisition activities and surging merger.
Whereas a few suppliers have advanced technology, many others will have to go beyond and purchase the technology they require to adapt and exist. Industry evolution is urging a lot of investment activity and chance, a trend probably to increase in Biden’s rule.
Institutional investors and huge pension money which require to meet governance, environmental and social needs in their careers are investing money to technological automakers, igniting a boom in rare purpose acquisition automakers in the EV industry.
Consumer EV incentives
The president has said that he wishes to motivate customers to purchase electric cars via tax credits. Presently, a $7,500 consumer tax break is being utilized for the first 200,000 cars sold by an automaker in the US federal government.
Till now, only General Motors and Tesla have reached the target. The subsidies of Tesla ended at the finish of 2019, whereas those for General Motors finished on 31st March. When 2019 ended, Congress refused to extend the cap to 600,000 electric vehicles for each automaker.
According to Biden, he wants the tax credit to advantage the middle class buyers and make the purchase of vehicles in America the top priority. This can be a challenge for some automakers such as Tesla. Ford is determined to manufacture a lot of its electric vehicles in Canada and Mexico. General Motors is likewise determined to make Hummer and high cost electric Cadillac models priced more than $100,000.
Moreover, Biden said he wants to initiate a “cash for clunkers” rebate program which would motivate Americans to trade their previous, carbon emission vehicle for the latest electric car. This strategy can be followed after a $450 billion program set up by the US Senate Democrats the previous year.
Final words
The message to automakers is that if you can regulate sustainability and environmental requirements, there are investment funds out there for them to gain. Maybe for the first time, the federal government, customers and the car industry are joining the alignment to go forward. This reflects a huge chance in the future for automakers which can see their position in the coming years.
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