Sen. Joe Manchin opposes $4,500 tax credit for EVs built in the U.S.

Senator Joe Manchin said Thursday that he opposes a provision of President Joe Biden’s $1.75 trillion social spending and tax plan that would offer $4,500 more in tax credits for the purchase of an electric vehicle made in the U.S. by union labor.

The West Virginia Democrat, in an interview with Automotive News, called the extra credit “wrong” and “not who we are as a country.”

Manchin made the comments during an appearance at Toyota Motor Corp.’s factory in Buffalo, West Virginia. The plant, like the Japanese automaker’s other factories in the U.S., are non-union.

Opposition by Manchin, a key swing vote in the closely divided Senate, could doom the labor-friendly provision that Biden has publicly endorsed. The credits are in a draft House bill that is poised to receive a vote as soon as next week, pending an official estimate of the bill’s cost from the Congressional Budget Office.

Toyota has lobbied against labor-friendly provisions of the bill that favor vehicles made in the U.S. Manchin told the Automotive News that he is opposed to any electric vehicle tax credit that allows some automakers to offer more discounts on electric cars than others.

“When I heard about this, what they were putting in the bill, I went right to the sponsor and I said, ‘This is wrong. This can’t happen,” the paper quoted Manchin as saying. “It’s not who we are as a country. It’s not how we built this country, and the product should speak for itself.”

Michigan Democratic Senator Debbie Stabenow and other Detroit-area lawmakers have pushed for the provision. Stabenow’s office did not immediately respond to a request for comment.

“We shouldn’t use everyone’s tax dollars to pick winners and losers. If you’re a capitalist economy that we are in society then you let the product speak for itself, and hopefully, we’ll get that, that’ll be corrected,” Manchin said.

Manchin’s office had no immediate comment on the report. The senator was at the factory touting a $240 million investment by the company to add a production line of hybrid transaxles.

Biden’s plan calls for all automakers to be able to offer $7,500 to consumers for EV purchases for the first five years of the law, a win for Tesla Inc. and General Motors Co., which have been bumping up an existing cap that limits the number of tax credits manufacturers can offer to 200,000.

However, cars made in the U.S. by union-represented workers would be allowed to offer an additional $4,500 in credits according to a draft text of the bill released by the House that is subject to further negotiation. Tesla and foreign-owned automakers such as Toyota and Honda Motor Co. have argued that would give an unfair advantage to Detroit automakers as the industry races toward an electric future.