In summary

Assembly Bill 794 strips away language requiring essential manufacturing and assembly to be done in the United States.

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By David Campbell

David Campbell is secretary-treasurer of United Steelworkers Local 675,

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Jennifer Drudge, Special to CalMatters

Jennifer Drudge is the California field coordinator for the Alliance for American Manufacturing,

California has set a requirement that all new vehicles sold here be emissions-free by 2035, and the Legislature is updating the state’s purchasing incentive program to get drivers into cleaner cars quickly. If we get the rules right for this redesigned automobile voucher, we’ll also encourage the local growth of a fast-emerging industry.

But that’s a big if. The inclusion of domestic manufacturing and assembly requirements could create new businesses and thus new jobs in California and elsewhere in the U.S. — a key concern for the 100,000 of us in fossil-fuel industries who will have to transition into new lines of work. Unfortunately, just before passing Assembly Bill 794 — its version of the new rules — the Assembly stripped out all of the domestic manufacturing requirements. And unless the Senate restores them, the auto jobs this voucher creates won’t necessarily be in California. They may not be in Nevada, Arizona, Oregon or anywhere else in the United States, either. 

This bill was meant to be specific. Incentive programs already exist to provide financial assistance for the purchase of individual vehicles and fleets. AB 794 creates labor and workforce standards that fleet purchasers of airport shuttles or delivery trucks would be required to meet to be eligible for incentives. It also would establish labor and workforce standards for automakers who want to participate.

When it was first introduced, though, AB 794 went further. The original legislation stipulated that to qualify for a rebate, vehicles must not only be assembled in the U.S., they must contain a certain percentage of American-made parts, making the early version of this bill a means by which our economy could more justly and efficiently make the shift to electric vehicles. 

Here’s how: As a UC Berkeley study recently concluded, by creating and guaranteeing a market for domestic manufacturers in the auto industry and its supply chain, public programs meant to drive the EV transition would not only improve national economic competitiveness, but sustain American jobs and support workers affected by the change.

In the stripped-down version of AB 794, however, the phrases “domestic content” and “domestic assembly” no longer appear. It now only mentions the “intent of the Legislature” to write domestic-content requirements itself — sometime down the road.

These are meaningful subtractions. Restoring them means that this wildly popular voucher could directly support American workers in the auto industry and its supply chain, a heavily unionized workforce that earns solid wages. Excluding them means it might not. That isn’t just a missed opportunity — it’s a major mistake.

Let’s not kid ourselves: We’re a big state and a big market, and the rules California sets for governing electric vehicles will be a road map for standards in other states. The rules for such incentive programs will influence the size and shape of the burgeoning American EV industry. And they’ll play a big role in determining whether the jobs this industry will create will be in California or elsewhere in the U.S. — or wind up someplace else.

This is bigger than cars and trucks. The UC Berkeley study predicts that 2 million jobs could be created across the United States during the transition to EVs – and those aren’t just auto or auto-parts jobs, but jobs building out public transit and the physical infrastructure needed for widespread use of EVs, such as charging stations. 

But we’re only going to get those jobs if we get the policies that will guide and govern this transition right. That starts with the specifics of a voucher program in California.

The labor and workforce standards are important. But if we want workers in California and the rest of the country to benefit from our societywide switch to electric vehicles, legislators must put domestic parts and assembly at the heart of this bill.

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