Want to save the US auto industry? Keep clean energy investments

In just a few short years, the Inflation Reduction Act (IRA) has become a cornerstone of the American manufacturing renaissance.

The IRA has set off billions in investments across a range of clean energy sectors, from manufacturing to, importantly, automaking. Hundreds of thousands of jobs have been created or advanced– with more on the horizon. Some have forecast that the IRA could create up to 1.3 million jobs and a nearly 1% higher GDP by 2030 alone.

Clean energy made up 10% of global GDP growth in 2023, with investments hitting $1.8 trillion the same year. Now is the time to jump on this quickly growing bandwagon.

“Federal investments in clean energy manufacturing are increasing America’s national security by cutting dependence on foreign countries, strengthening our economy by onshoring factories and manufacturing jobs, and cleaning our air by expanding clean energy options,” according to Forbes.

It is imperative that we stay on this track across a number of sectors if we want to remain globally competitive in an emerging clean energy future.

One sector that has grown substantially since the passage of the IRA is the American clean vehicle market. American-made electric vehicles (EVs) have exploded in popularity thanks to tax incentives in the IRA that make them more affordable for consumers – precipitating more and more demand for them to be built right here.

The IRA and EVs

Getting behind the wheel of an EV has never been easier – and more popular – for more and more American drivers, thanks in no small part to tax credits from the Inflation Reduction Act (IRA).

Tax credits in the IRA help drivers switch to clean, electric, made-in-America vehicles, with up to $7,500 for new vehicles and $4,000 for used vehicles. The savings don't stop there either, with electric vehicle owners projected to save as much as 50% over the vehicle's lifetime due to simpler powertrains and reduced need for certain maintenance tasks.

No wonder, then, that a recent poll conducted in the US by the Associated Press found that nearly one in 10 households surveyed owns or leases an EV and four out of ten are considering it for their next purchase. Helping this trend is the fact that once-prohibitive EV prices are coming down fast – and could reach cost parity with traditional vehicles in the next few years as manufacturers ramp up production to meet surging demand driven, in part, by the IRA’s incentives.

And transportation is, after all, the largest source of US greenhouse gas (GHG) emissions, accounting for around 28% of total emissions, and making it a must-address sector if we are going to successfully fight the climate crisis.

The legislation helps make these newer, cleaner technologies available to all – all the while saving even more money on gas and other expenses down the line.

The IRA’s EV incentives are no hand-out, either – they are an investment in American vehicle manufacturing and in our communities.

EVs are Flourishing

In the US and around the world, EVs have seen explosive sales growth.

In 2024, one report found that US EV sales reached a record 1.3 million – a 7.3% increase from 2023 alone. In total, EVs made up around 8.1% of all US light vehicle sales in 2024.

The numbers are even more staggering if you go back just one year. In 2023, sales reached over 1.2 million units, a 49% increase from 2022, the year of the IRA’s passage.

In Europe, in 2023, EV sales saw significant growth, with nearly 3.2 million new electric car registrations. That’s a nearly 20% increase from 2022, representing 22.7% of the market share for new car registrations.

Overall, globally, EV sales surged in 2024, growing approximately 25% to reach over 17 million units, another record for the industry.

Now, all that progress is under threat. Even as the EV market continues to grow and expand, creating American jobs, some lawmakers are threatening to undo all this progress by rolling back part of or all of the IRA.

This is something no one in the automotive industry wants – in large part because the IRA’s EV tax credits keep American car manufacturers competitive with foreign automakers, who are similarly responding to increased demand by turning out more and more EVs.

“The Alliance for Automotive Innovation, which represents major automakers including Ford and GM, urged Republican policymakers to preserve the IRA’s electric vehicle tax credits in October, saying they maintain a ‘globally competitive American auto industry’ that helps American automakers compete with China,” Forbes writes.

The IRA’s EV tax incentives are an investment in America’s future – and in its future competitiveness with foreign automakers. To roll them back now, at a time of explosive growth in the EV industry, would be an incredibly shortsighted move, one that could cripple American car manufacturing for years to come.

What You Can Do

The time to fight for the IRA’s EV incentives and other investments in clean American manufacturing is now.

We can support a healthy, sustainable, clean energy future by taking action.

Today, clean energy investments from the IRA are cutting costs and electricity bills for millions of Americans. No wonder clear majorities want more clean energy.

Tell Congress to fight for working families and protect the IRA’s clean energy credits and investments that make energy more affordable for all of us.

Join us in standing up for the IRA today.