FIRST ON FOX: A group of Republicans led by Sen. Marco Rubio, R-Fla., are planning to introduce legislation that would prohibit automakers from benefiting from a wide range of federal incentives if they move to offshore domestic manufacturing.
The Putting American Automakers First Act — on track to be introduced early next week by Rubio and original cosponsors Sens. JD Vance, R-Ohio, and Eric Schmitt, R-Mo. — would bar automakers from participating in 12 federal incentive programs if they offshore production, manufacturing or final assembly of their products for 10 years. The bill comes weeks after the largest U.S. autoworker union ratified new contracts with the "Big Three" American automakers.
"Despite the recent negotiations resulting in big wins for autoworkers, automakers still have the upper hand," Rubio said in a statement to Fox News Digital on Thursday.
"They can still undermine these deals by offshoring production to countries with cheaper labor," the Florida Republican continued. "This legislation would create a strong incentive for automakers to keep jobs right here in America and allow workers to share in the profits that they helped create."
The New Clean Vehicle Credit, Commercial Clean Vehicle Credit, Used Clean Vehicle Credit, Clean School Bus Program and Clean Heavy-Duty Vehicle Program are among the 12 programs that Rubio's legislation would block automakers from participating in. The programs save consumers and businesses thousands of dollars, bringing down the costs of electric vehicles (EV), which remain more expensive than gas-powered alternatives.
For example, under the new clean vehicle credit, Americans can save up to $7,500 on an EV if it means certain material and sourcing requirements outlined under the 2022 Inflation Reduction Act. According to Cox Automotive data, factoring in credits, the average transaction price for electric cars was $53,469 as of July 2023 while the average price of gas-powered vehicles was $48,334.
And Rubio's bill was designed to prevent automakers from moving production abroad after the recent labor negotiations between the United Auto Workers and Ford, General Motors and Stellantis. Republicans and experts have warned workers may bear the brunt given the projected costs of the agreements and recent struggles of the EV sector.
"I support the UAW’s demand for higher wages, but there is a 6,000-pound elephant in the room: the premature transition to electric vehicles. While EV supply chains are still heavily concentrated in China, the Biden administration sends billions to that industry every year," Vance said in September.
"While most Americans want to drive a gas-powered car, the Biden administration pursues a policy explicitly designed to increase the cost of gas," he said. "They do this in the name of the environment, but all they’re doing is enriching the dirtiest economy in the world at the expense of auto workers in Ohio, Pennsylvania, and Michigan."
On Thursday, Ford projected that the new UAW agreement, which came after a weeks-long strike at multiple auto plants nationwide, will cost it $8.8 billion over the life of the contract which lasts until 2028, CNBC reported. One day earlier, General Motors projected the contract would cost it more than $9 billion.
In addition, while EV sales continue to increase incrementally, automakers have struggled to see a significant return on investment. Ford projected earlier this year that its EV division was projected to lose a staggering $4.5 billion in 2023 alone and earlier this month scaled back an ambitious billion-dollar EV battery plant in Michigan.