Trump threatens electric vehicle subsidies because of GM closures

Washington Times:

The White House is threatening to curtail federal subsidies for electric cars in response to General Motors‘ decision to shut down auto production at plants in Ohio and Michigan.

President Trump said Tuesday his administration is now “looking at cutting all” federal subsidies for GM, including for electric cars. He said he was “very disappointed” with CEO Mary Barra’s decision to close factories in the U.S.

“Nothing being closed in Mexico & China,” Mr. Trump tweeted. “The U.S. saved General Motors, and this is the THANKS we get! General Motors made a big China bet years ago when they built plants there (and in Mexico) - don’t think that bet is going to pay off. I am here to protect America’s Workers!”

White House economic adviser Larry Kudlow said the administration is “going to be looking at certain subsidies for electric cars,” a day after he met with Ms. Barra. He would not elaborate.

GM said Monday it is closing the plants, in part, due to low demand for certain car models, including the electric Chevrolet Volt. Up to 14,000 workers in the U.S. and Canada will be laid off by the end of this year.

The federal government offers tax credits of up to $7,500 to lower the up-front costs of plug-in electric vehicles.
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Ford had earlier announced that it would be dropping much of its traditional sedan production and concentrate on trucks and SUVs, but it announced no closing of plants at the time.  The market for sedans is soft and is even worse in the used market.  Top of the line sedans are losing half their value in about three years whereas pickup truck demand remains high in the used market.

Electric car demand has been weak outside of places like California.  Those cars are basically commuter cars and in town cars.  There is inadequate infrastructure to service them on a road trip.