April 16, 2024


News for all

Where A Vice President Might Steer Things

Kamala has won the Veepstakes. The Democratic Nominee, Joe Biden, finally selected his Vice Presidential running mate after an elongated process: Senator Kamala Harris of California. Now that this has been resolved, the question in many minds is how will she may affect the overall platform. Will she simply support from the shadows, or will she hit the ground running with major impacts to business?

As implied by the 2018 movie Vice, few vice presidents shape history unless ascending to the presidency. However, given her strong personality and a 77-year-old running mate, it’s worth a look at Harris’s voting history and political stances to understand her possible effect on specifically automotive. Otherwise, per the narrator of Vice, “As the world becomes more and more confusing, we tend to focus on the things that are right there in front of us while ignoring the massive forces that actually change and shape our lives.”

Assuredly, there are multiple realms where a leader in one of the world’s leading economies might influence the auto industry, but let’s focus on three: electric vehicles, international tariffs, and product liability.

More Electric Vehicles

Coming from California, it should be no surprise that Senator Harris has a long record of action on climate change including investigating Exxon Mobil
in 2016, voting against repeals of methane emissions, and sponsoring the resolution of disapproval for the 2019 rollbacks on power plant carbon pollution limits. She has a 91% lifetime score from the League of Conservation Voters as a lawmaker whose voting records on environmental issues is favorable.

Specific to the automotive industry, Harris opposed the Trump Administration’s attempts to reverse the Obama-era fuel efficiency standards. On March 31st, she rebuked the repeal stating, “Hospitals are in desperate need of ventilators for people with respiratory illnesses, millions have applied for unemployment, and families across the nation are struggling to make ends meet. This administration’s own analysis has shown this is a bad deal for Americans. During this time of crisis, we should have every federal policy – including bold clean car standards – in place to make our air clean, create jobs, and save consumers’ money.”

It is unlikely that Harris would “drive” fuel-efficiency regulations to more painful heights, though, since automotive manufacturers are already facing international pressures regarding fuel economy. The European Union has mandated the average equivalent of fifteen-seven (57) miles per gallon in 2021 and ninety-two (92) mpg by 2030. Even China has a zero-emission mandate for a percentage of the vehicles (albeit with significant consumer incentives).

A more likely influence might be the introduction of “… incentives for cars to be replaced with zero-emission vehicles manufactured in America, and extra, targeted assistance for low and middle-income families.” Harris said emphatically during a 2019 Town Hall that, “By my plan, by 2045 we will have basically zero emission vehicles only,” but her climate plan calls for 100% of vehicles as soon as 2035.

Lower Tariffs

Like most politicians, Senator Harris is for more home-grown products and jobs. She does, though, have a mixed bag on tariffs and trade agreements that could influence open commerce. Prior to Trump’s 2017 withdrawal from the Trans-Pacific Partnership, she publicly criticized the agreement citing that it did not sufficiently protect workers as well as the environment. “As I’ve long said, I will oppose any trade deal that doesn’t look out for the best interests of American workers and raise environmental standards, and unfortunately the TPP didn’t pass either test.”

Her more-relevant and recent oppositions, though, are to the tariffs that have been imposed over the last four years and the USMCA (United States, Canada, Mexico Agreement). “I am not a protectionist Democrat. Look, we need to sell our stuff. And that means we need to sell it to people overseas. That means we need trade policies that allow that to happen.” She claims the current administration’s “trade taxes” are taking $1.4B “out of working people’s pockets every month.”

How might this affect the auto industry? Possibly in multiple ways, which scholarly political scientists shall debate. However, the obvious areas that may be affected are material costs, import prices and employment on-shoring.

Tighter Product Liability

Those corporations thinking about reducing Functional Safety efforts might want to think again. Senator Harris spent six years in California as the Attorney General with several landmark cases of corporate punitive damages, not the least of which was a $1.2B judgement for restitution and civil penalties, and a product liability settlement against Brazilian Blowouts. Even as recently as May 2020, she urged lawmakers to “speak truth about who’s bearing a disproportionate share of the risk” when talking about workers and the possibility of limiting corporate liability.

Not much of this has been automotive-related, but her history — both as a politician and prosecutor — of supporting consumers and workers suggests a possible influence on product liability. As Kamala herself stated, “In California, we have some of the strongest consumer protection laws in the country. While it is easy to conceive of innovation and regulation as mutually exclusive, California is proof that we can do both. We can innovate responsibly.”

“What we all want is public safety. We don’t want rhetoric that’s framed through ideology.”

Final Thought

Today’s announcement may change nothing. Biden and Harris might not win in November and, even if they do, Harris alone might not change the course of the global, automotive economy and its associated technologies. Then again, as the Chinese proverb says, “The winds of heaven change suddenly; so do human fortunes.”