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The research instead suggests the opposite is true.
When former President Donald Trump was campaigning in Michigan last week, he warned autoworkers that President Biden’s electric vehicle policies would “put an end” to their “way of life.”
“Hundreds of thousands of American jobs, your jobs, will be gone forever,” he said. “By most estimates, under Biden’s electric vehicle mandate, 40% of all U.S. auto jobs will disappear.”
Trump may be exaggerating, but the underlying idea, that electric vehicles require less labor to manufacture than internal combustion engine cars, is the conventional wisdom. It has been circulated for years by automakers, autoworkers, politicians, and journalists. EVs contain fewer parts, the thinking goes, so naturally they will require fewer workers.
That logic seems obvious, which might be why it hasn’t received much scrutiny. But when I tried to find any research supporting it, what I found instead suggested the opposite. A number of analyses showed that electric vehicles could actually require more labor to build than gas-powered cars in the U.S., at least for the foreseeable future.
There are countless news articles and studies that reiterate the point that electric vehicles “have fewer moving parts” or are “less complex” and therefore pose a threat to autoworkers’ jobs. Many cite a 2017 Ford presentation that mentioned a “30% reduction in hours per unit” as a benefit of producing EVs, or former Volkswagen CEO Herbert Diess, who said in 2019 the company would need to make job cuts due to its switch to EVs, which “involve some 30% less effort.” More recently, as the United Auto Workers strike has ramped up, a 2022 quote from Ford’s CEO Jim Farley that “it takes 40% less labor to make an electric car,” has been circulating.
But I couldn’t find any data, research, or even further explanation backing up these figures. Part of the challenge of digging into these claims is that it’s not clear what they even refer to. Are the CEOs talking about the labor required for final assembly, like dropping in the motor and putting on the doors? Are they taking into account the production of components, like the EV battery? Where do they draw the line on what constitutes EV manufacturing?
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Ford didn’t respond directly to my request for more information about its public estimates. Instead, spokesperson Dan Barbossa replied that if I was going to quote Farley, I needed to include his entire quote. After dropping the “40% less labor” statistic, Farley had continued, “So as a family company, we have to insource so that everyone has a role in this world. We have a whole new supply chain to fill out, in batteries and motors and electronics.”
There may be more to Farley’s words than a bit of public relations fluff. His suggestion that building out new supply chains will help people find “a role” aligns with the conclusions of a study that Volkswagen’s independent Sustainability Council commissioned in 2020. It was conducted by the Fraunhofer Institute for Industrial Engineering, a German research group, using Volkswagen company data, and found only minor impacts on employment due to the transition. Losses can be mitigated by “shifting to the production of new components,” it said, like the individual battery cells that make up the battery packs.
One of the findings was that “employment intensity” for the final manufacturing of Volkswagen’s electric ID.3 is only 3% lower than that of the conventional Golf Mk8. The bigger gap is in the labor required to produce the individual components of each car’s drivetrain. The employment intensity of the battery system and electric motor, combined, was about 40% lower than that of the combustion engine and transmission system.
Notably, the study did not include the jobs required to produce the individual battery cells which make up the battery system, because Volkswagen wasn’t producing them at the time. But a more recent analysis of the U.S. manufacturing landscape found that cell production holds the most potential for job creation, and concluded that if you account for this, the transition to EVs could actually result in significantly more jobs.
Turner Cotterman, a McKinsey consultant, led the research as part of his Ph.D. in public policy and engineering at Carnegie Mellon under Associate Professor Kate Whitefoot. He sought out partnerships with U.S.-based automakers and electric vehicle component manufacturers and collected original data from nine companies on the number of hours it takes to complete more than 250 process steps. In some cases he visited the shop floors and personally gathered the data himself. In his final analysis, he also incorporated public data for an additional 78 production process steps. He used the data to model three scenarios where EV and combustion engine powertrains are produced at the average efficiency, as well as a “most efficient” case and a “least efficient” case.
In every case, EV manufacturing required more hours. The conventional powertrains took 4 to 11 worker hours, while the EV powertrains took 15 to 24. “A lot of the confusion sits around, what parts are you counting in this evaluation?” Cotterman told me. “We’re saying that if you were to produce every single component in an EV in the U.S., that the total sum of those powertrain components will be higher than the equivalent ICE components.”
Cotterman, Turner and Fuchs, Erica Renee and Whitefoot, Kate, The transition to electrified vehicles: Evaluating the labor demand of manufacturing conventional versus battery electric vehicle powertrains (June 4, 2022)
There are a few important caveats to the research. For one, Cotterman stressed that these are present-day numbers, and they might change as EV plants scale up and learn to be more efficient. When he looked at data from Chinese manufacturing plants, they were a lot more efficient than what he saw in the U.S. And that relates to his other point. Currently, most battery components are not made in the U.S.
“With so many battery components made in China and South Korea, a lot of those potential labor hours are being captured by other countries,” he said. “So it's a question of the future American manufacturing workforce — how do we value them? How many opportunities do we want to extend to them?”
Another report published in 2021 by the Economic Policy Institute, a nonpartisan think tank, reached a similar conclusion. It found that the stakes for workers in the EV transition depend largely on public policy efforts to shore up U.S. manufacturing and enhance job quality. “The real challenge is making sure U.S.-based producers can invest enough to become competitive in battery production, and claw back some of the overall sales market share they lost since the Great Recession,” Josh Bivens, chief economist at the institute, told me in an email. “These are much bigger deals than anything about the inherent production process of EVs — and they’re very amenable to policy.”
Automakers have claimed that paying workers more would put them at a disadvantage and hinder their ability to invest in the EV transition. But in a recent blog post, the Economic Policy Institute argued that with the help of subsidies from President Biden’s signature climate law, the Inflation Reduction Act, automakers have “more than enough money” to invest in EVs, pay workers a fair share, and maintain healthy profits.
The IRA created a domestic manufacturing tax credit that subsidizes the production of battery cells to the tune of $35 per kilowatt-hour of capacity. It offers an additional $10 per kilowatt-hour tax credit for the domestic production of battery modules, or the process of assembling the cells into arrays that later get put into battery packs. And there’s another incentive for automakers to onshore battery production — it will help their vehicles qualify for the IRA’s consumer tax credit.
According to a database maintained by the advocacy group Climate Power, there have been about 10 EV battery manufacturing plant projects announced in the U.S. since the IRA was passed, at least some of which will produce cells.
So is the crux of the matter that EV job losses or gains all come down to batteries? Not necessarily.
Whether or not the U.S. is able to build up domestic battery production, early evidence of the EV transition in the United States shows that EVs may require more labor, even in the final assembly stages.
Anna Stefanopoulou, a professor of mechanical engineering at the University of Michigan, has been investigating three manufacturing sites that used to produce conventional cars and are now producing EVs: A Tesla factory in California that used to be a jointly-owned facility between GM and Toyota that produced Pontiacs and Corollas; a Rivian plant in Illinois that previously produced Mitsubishis; and the Orion Assembly plant in Michigan, where GM transitioned from producing Chevy Sonics and Buick Veranos to electric Chevy Bolts.
Her research has not been peer reviewed or published yet, but Stefanopoulou told me that after analyzing publicly available data sources for employment and output at each plant, she found that productivity had gone down in all three cases. Each one is producing fewer vehicles per worker than they were before, meaning it’s taking more people per vehicle to produce electric cars. The California site, which has been producing EVs for the longest out of the three, showed the most dramatic change. At its peak, the GM/Toyota plant produced 80 vehicles per person per year. The Tesla plant averages 30.
Stefanopoulou believes the data reflects the nascent state of U.S. electric vehicle manufacturing. She predicts that after a decade or so, as processes become more streamlined, the commonly-held belief that EV assembly requires less labor will turn out to be correct. However, she also said that if she were to consider battery cell production, as Cotterman did, EV production on the whole could require more people.
She also stressed that her data is not conclusive, and poses many more questions. For example, she found that overall production per worker in the U.S. is falling. So does the labor intensity at the EV plants reflect something specific about those factories, or a bigger issue in U.S. manufacturing productivity?
It’s also been hard for her team to identify what was actually being produced at each plant at any given time. For example, the previous owners of the California plant did not assemble engines there, but the Tesla factory is assembling battery packs. So that might explain why productivity is so much lower now. But there are a lot of unknowns. “Over the years, they changed their patterns,” she told me. “They take the cells and assemble the pack, or occasionally they manufacture cells. So we don’t know exactly what kind of work the plants include. We know the outputs are vehicles, but what does assembly include?”
In any case, Stefanopoulou is torn about what conclusion to draw from her findings on productivity. “Sometimes I don’t know if what I will present in my paper will be good news or bad news,” she told me. “Maybe it’s good news for our people that are involved, but at the end, you know, we need to be productive also, so that we can actually lower the costs so people can afford buying electric vehicles.”
What seems clear is that whether the transition results in more jobs or fewer depends a lot on which processes you’re including, how many of them will ultimately be done domestically, and how much will get streamlined through automation and other efficiency measures.
At the same time, topline job numbers aren’t the full story. The jobs created in the EV transition will certainly not all resemble the jobs that are lost. They may not be located in the same places, or require the same set of skills. Workers are right to be worried about upheaval.
But these are things that can be managed, if automakers are willing to come to the table with workers, and vice versa. For example, when Ford negotiated the closure of its Romeo Engine Plant at the end of last year, every employee was offered either a buyout or a transfer to another facility. Barbossa, the Ford spokesperson, told me many are now working about 20 minutes away, at the Van Dyke Electric Powertrain Center, building EV power units for the F-150 Lightning and hybrid powertrains for the Maverick and F-150.
I reached out to the United Autoworkers to get their thoughts on these studies, but the union did not respond to my questions. The UAW does appear to have a good handle on the stakes of battery manufacturing, however. Last week, Jim Farley of Ford provided an update on the negotiations, and said that “the UAW is holding the deal hostage over the battery plants.”
Farley vowed that none of its workers will lose their jobs due to battery plants during the next contract period. “In fact, for the foreseeable future we will have to hire more workers as some workers retire, in order to keep up with demand,” he said. “We are open to working with the union on a fair deal for battery plants, but these are multi-billion investments and they have to make business sense.”
Read more about electric vehicles and labor:
What the UAW Wants Exactly — and What It Means for Electric Cars
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That’s okay for clean energy firms, terrible for manufacturers, and a big risk for everyone.
Over the past few months, you could put together three different — and somewhat conflicting — pictures of the American economy.
For companies exposed to the AI boom, business has been good — excellent, even. The surge in ongoing capital investment into data centers and electricity has been larger than other recent booms, such as the telecom buildout. Electricity demand is soaring, especially in Texas and the Mid-Atlantic. Technology companies have signed power offtake deals with nuclear and hydroelectricity companies. If anything, companies exposed to artificial intelligence are more afflicted by congested supply chains and shortages than by slack demand — see the yearslong waiting lists to get a new transformer or natural gas turbine.
Outside of the AI economy, though, the economy has been a fair bit colder. You might even say it’s been frozen by indecision. When you talk to business leaders, they confess confusion about where things are heading. President Trump’s constantly changing tariffs — and his administration’s mercurial policy shifts — have made it difficult for non-AI-exposed businesses to plan long-term capital investment.
You could hear this view from clean energy manufacturing and traditional fossil firms alike. When I talked to John Henry Harris, the CEO of the medium-duty truck maker Harbinger Motors, for an episode of Heatmap’s Shift Key podcast in June, he told me that his company was just about to shift a production process to Mexico when a last-minute Trump change made it cheaper to keep it in China. Meanwhile, an oil and gas executive recently told the Dallas Federal Reserve: “The Liberation Day chaos and tariff antics have harmed the domestic energy industry. Drill, baby, drill will not happen with this level of volatility.”
But the data contradicted that tepid view. This was the third picture that we were getting of the economy. Through the summer, federal surveys showed an economy that was performing okay. In May, according to the Bureau of Labor Statistics, the U.S. economy added 139,000 jobs; it gained another 147,000 jobs, apparently, in June. The AI boom was clearly contributing to those robust reports. But how could an economy that business leaders otherwise described as difficult be going so well?
Now we can finally square these disparate pictures.
On Friday, the federal government released its newest tranche of job numbers. The headline number was mediocre — the U.S. added a mere 73,000 jobs in July — but the guts of the report were worse. The government revised down its estimate of the May and June reports by a total of 258,000 jobs. With these new numbers in hand, it’s clear that the labor market has essentially stalled out since Liberation Day in April.
The unemployment rate slightly rose to 4.2%, which was in line with what economists predicted.
These new reports clarify that the broader American economy wasn’t actually thriving. Its summer strength was a mirage the whole time. Outside of AI, things are downright frigid. And as President Trump continues to shuffle tariffs and increase trade uncertainty, we can expect conditions to worsen. Trump seems hellbent even on clouding our ability to understand the underlying economy: on Friday afternoon, he fired the Bureau of Labor Statistics commissioner, a career civil servant.
If you squint, you can see a hazy “AI sector” versus “non-AI sector” distinction in the data, even among the energy and decarbonization companies we cover at Heatmap. But it’s not obvious. Contrary to what you might expect when power demand is surging, utility employment was basically flat last month. Heavy and civil engineering construction jobs were up by 6,000, and “nonresidential specialty trade contractors” — a category that can include electricians — gained nearly 2,000 jobs.
But manufacturing lost 11,000 jobs last month, with the motor vehicles industry driving 2,600 of those losses. Mining, quarrying, and oil and gas jobs were down. The Institute of Supply Management report, a private survey of U.S. manufacturing activity, showed the sector shrank in July for the fifth month in a row.
And even though the Department of Government Efficiency’s deferred buyout program for more than 150,000 people has yet to hit, the federal government bled 12,000 jobs.
In a way, the clean energy industry — or at least solar, battery, nuclear, and geothermal developers — might consider themselves lucky. Despite the best efforts of Trump’s officials, and despite the chaos of President Trump’s policies, they have been able to eke through the past few months because of the AI boom. Nearly 70% of all new power-generating capacity added to the U.S. grid in the first quarter of this year came from solar panels, and the government has thrown its weight behind next-generation nuclear and geothermal technologies. A tepid jobs report might even bring some interest rate relief from the Federal Reserve.
But if that AI boom slows down, we should all watch out below.
A conversation with Heather O’Neill of Advanced Energy United.
This week’s conversation is with Heather O’Neill, CEO of renewables advocacy group Advanced Energy United. I wanted to chat with O’Neill in light of the recent effective repeal of the Inflation Reduction Act’s clean electricity tax credits and the action at the Interior Department clamping down on development. I’m quite glad she was game to talk hot topics, including the future of wind energy and whether we’ll see blue states step into the vacuum left by the federal government.
The following conversation has been lightly edited for clarity.
During Trump 1.0 we saw blue states really step into the climate role in light of the federal government. Do you see anything similar taking place now?
I think this moment we’re in – it is a different moment.
How are we handling load growth? How are we making sure consumers are not paying for expensive stranded assets? Thinking about energy affordability? All of those challenges absolutely present a different moment and will result in a different response from state leaders.
But that’s where some of the changes our industry has gone through mean we’re able to meet that moment and provide solutions to those challenges. I think we need aggressive action from state leaders and I think we’ll see that from them, because of the challenges in front of them.
What does that look like?
Every state is different. Take Virginia for example. Five years after we passed the Virginia Clean Economy Act – a big, bold promise of action – we’re not on track. So what are the things we need to do to keep the foot on the accelerator there? This last legislative session we passed the virtual power plant legislation that’ll help tremendously in terms of grid flexibility. We made a big push around siting and permitting reform, and we didn’t quite get it over the finish line but that’s the kind of thing where we made a good foundation.
Or Texas. There’s so much advanced energy powering Texas right now. You had catastrophic grid failure in Hurricane Uri and look at what they’ve been able to build out in response to that: wind, solar, and in the last few years, battery storage, and they just passed the energy waste reduction [bill].
We need to build things and make it easier to build – siting and permitting reform – but it’s also states depending on their environment looking at and engaging with their regional transmission organization.
You saw that last week, a robust set of governors across the PJM region called on them to improve their interconnection queue. It’s about pushing and finding reforms at the market level, to get these assets online and get on the grid deployed.
I think the point about forward momentum, I definitely see what you’re saying there about the need for action. Do you see state primacy laws or pre-emption laws? Like what Michigan, New York, and California have done…
I’m not a siting expert, but the reform packages that work the best include engagement from communities in meaningful ways. But they also make sure you’re not having a vocal minority drowning out the benefits and dragging out the process forever. There are timelines and certainty attached to it while still having meaningful local engagement.
Our industry absolutely has to continue to lean into more local engagement and community engagement around the benefits of a project and what they can deliver for a community. I also think there’s a fair amount of making sure the state is creating that pathway, providing that certainty, so we can actually move forward to build out these projects.
From the federal government’s perspective, they’re cracking down on wind and solar projects while changing the tax credits. Do you see states presenting their own incentives for renewables in lieu of federal incentives? I’ve wondered if that’ll happen given inflation and affordability concerns.
No, I think we have to be really creative as an industry, and state leaders have to be creative too. If I’m a governor, affordability concerns were already front and center for me, and now given what just happened, they’re grappling with incredibly tight state budgets that are about to get tighter, including health care. They’re going to see state budgets hit really hard. And there’s energy impacts – we’re cutting off supply, so we’re going to see prices go up.
This is where governors and state leaders can act but I think in this context of tight state budgets I don’t think we can expect to see states replacing incentive packages.
It’ll be: how do we take advantage of all the flexible tools that we have to help shape and reduce demand in meaningful ways that’ll save consumers money, as well as push on building out projects and getting existing juice out of the transmission system we have today.
Is there a future for wind in the United States?
It is an incredibly challenging environment – no question – for all of our technologies, wind included. I don’t want to sugar-coat that at all.
But I look at the whole picture, and I include wind in this: the technologies have improved dramatically in the past couple of decades and the costs have come down. When you look around at what resources are around to deploy, it’s advanced energy. We’re seeing it continue to grow. There’ll be headwinds, and it’ll be more expensive for all of us. But I look at what our industry and our technologies are able to offer and deliver, and I am confident we’ll continue to see growth.
The Grain Belt Express was just the beginning.
The anti-renewables movement is now coming for transmission lines as the Trump administration signals a willingness to cut off support for wires that connect to renewable energy sources.
Last week, Trump’s Energy Department with a brief letter rescinded a nearly $5 billion loan guarantee to Invenergy for the Grain Belt Express line that would, if completed, connect wind projects in Kansas to areas of Illinois and Indiana. This decision followed a groundswell of public opposition over concerns about land use and agricultural impacts – factors that ring familiar to readers of The Fight – which culminated in Republican Senator Josh Hawley reportedly asking Donald Trump in a meeting to order the loan’s cancellation. It’s unclear whether questions around the legality of this loan cancellation will be resolved in the courts, meaning Invenergy may just try to trudge ahead and not pick a fight with the Trump administration.
But the Grain Belt Express is not an anomaly. Across the country, transmission lines tied to both renewable sources and more conventional fuels – both fossil and nuclear – are facing a growing chorus of angst and anguish from the same crowds that are fighting renewable energy. In some ways, it’s a tale as old as widespread transmission itself. But I am also talking about farmers, ranchers, and rural towns who all now mention transmission lines in the same exasperated breaths they use to bemoan solar, wind, and battery storage. Many of the same communities fighting zero-carbon energy sources see those conflicts as part of a broader stand against a new age of tech industrial build-out – meaning that after a solar or wind farm is defeated, that activism energy is likely to go elsewhere, including expanding the grid.
I’ve been trying to figure out if there are other situations like Grain Belt, where a project facing local headwinds could potentially be considered no longer investable from a renewables-skeptic federal perspective. And that’s why since Invenergy lost its cash for that project, I have been digging into the Cimarron Link transmission line, another Invenergy facility proposed to carry wind energy from eastern Oklahoma to the western part of the state, according to a map on the developer’s website.
Do you remember the campaign to ban wind energy in Oklahoma that I profiled at the start of this year? Well, one of the most prominent scalps that this activism movement has claimed was bagged in late 2024, when they successfully pressured Governor Kevin Stitt into opposing a priority transmission corridor proposed by the Biden administration. Then another one of the activists’ biggest accomplishments came through an anti-wind law enacted this year that would, among other things, require transmission projects to go through a new certification program before the state’s Corporation Commission. Many of the figures fighting Cimarron and another transmission line project – NextEra’s Heartland Spirit Connector – are also involved in fighting wind and solar across the state, and see the struggles as part and parcel with each other.
Invenergy appears to want to soldier on through this increasingly difficult process, or at least that’s according to a letter some landowners received that was posted to Facebook. But these hurdles will seriously impact the plausibility that Cimarron Link can be completed any time soon.
Now, on top of these hurdles, critics want Cimarron Link to get the Grain Belt treatment. Cimarron Link was told last fall it was awarded north of $300 million from the Energy Department as a part of DOE’s Transmission Facilitation Program.
Enter Darren Blanchard, a farmer who says his property is in the path of Cimarron Link and has been one of the main public faces of opposition against the project. Blanchard has recently been pleading with the DOE to nix the disposition of that money if it hasn’t been given already. Blanchard wrote the agency a lengthy request that Cimarron get similar treatment to Grain Belt which was made public in the appendix of the agency’s decision documents related to the loan cancellation (see page 23 of this document).
To Blanchard’s surprise, he got a reply from the Transmission Facilitation Program office “responding on behalf of” Energy Secretary Chris Wright. The note, to him, read like they wanted him to know they saw his comment: “We appreciate you taking the time to share your views on the project,” it read.
Now, this might’ve been innocuous. I haven’t heard back from the Energy Department about Cimarron Link and I am personally skeptical of the chances a grant is canceled easily. There is no high-level politician calling for the cancellation of this money right now, like there was in Sen. Josh Hawley and the Grain Belt Express.
But I do believe that if there is a will, there is a way with the Trump administration. And as anti-renewables sentiments abound further, there’ll be more ways to create woe for transmission projects like Cimarron that connect to renewable resources. Should voices like Blanchard aim their sights at replicating what happened with Grain Belt, well… bets may be off.
Over the next few weeks, I will be chronicling more fights over individual transmission projects connected to zero-carbon sources. Unique but with implications for a host of proposed wires across the country, they’re trend-setters, so to speak. Next week I’ll be tackling some power lines out West, so stay tuned.