A new report from the International Energy Agency confirms what you probably already knew: the rush to electrify transportation.
Worldwide, 14% of new cars registered last year were electric and 26 million electric vehicles were on the road, an impressive 60% from 2021 alone. China leads the way in adoption, followed by Europe and then the USA where 8% of new cars sold in 2022 were electric.
Sales are expected to grow by 2023, a safe bet considering how major automakers are pushing to produce electric vehicles. Intense competition among car companies, coupled with high fuel costs and government incentives to combat climate change, will make the transition faster than it would otherwise be.
The shift away from internal combustion engines has opened the door to tech-focused upstarts like Tesla, Rivian and Lucid, not to mention Chinese manufacturers that are producing premium electric vehicles. The old guard is under pressure to change, putting the future footprint of the auto industry at stake.
While we welcome the business opportunities of the EV boom, we also know that the Midwest has a lot to lose as the game changes. Legacy automakers and their suppliers provide some of the best blue-collar jobs around and make high-impact contributions to local economies. This region cannot afford to lose its motor mojo.
Illinois, unfortunately, is at risk of being left behind. Part of the reason is the state’s high costs, especially its taxes and workers’ compensation insurance, as well as a government that seemingly favors unions over employers at every turn. This creates a business climate so inhospitable that even state incentive giveaways can’t seem to overcome it.
In 2021, the General Assembly and Governor JB Pritzker wisely introduced an incentive program for electric vehicle manufacturers. T/CCI, an electric vehicle supplier, stepped in to take advantage of this.
After that, nothing.
With no one else accepting their offer, Pritzker and Co. late last year they tweaked the so-called REV Illinois program to offer even sweeter incentives. When he signed the updated measure, Pritzker touted Illinois as a “leader in the electric vehicle revolution” and “the best place in the nation” for electric vehicle companies to call home.
The result so far is nothing.
The state said its pipeline of prospects has increased “significantly” since the expanded incentives went into effect in February. “We look forward to announcing additional REV agreements in the near future,” the state’s economic development agency said in a statement.
what’s taking so long Despite its high costs, Illinois enjoys significant advantages over competing states, such as an experienced workforce, centralized transportation, a world-class city in Chicago, and great brainpower in its research centers and universities.
This page recently celebrated Illinois scientists who made a breakthrough in battery technology that promises to increase the range of electric vehicles. Illinois claims to be home to 1,800 companies that make electric vehicle parts and has a longstanding foundation in the industry through local stalwarts like Navistar and BorgWarner.
But it’s also obvious that all is not well in Illinois’ auto industry, and not just because of a weak incentive program.
Rivian, a maker of high-end electric vehicles that resurrected a former 2.6 million-square-foot Mitsubishi plant in upstate Normal, has seen its share price sink amid doubts that he can compete in a crowded field, even though he’s pinned a lot of future hopes on selling them. its impressive electric delivery vehicles to customers such as Amazon. Stellantis’ large assembly plant in Belvidere, outside Rockford, is idle, no longer producing gasoline-powered Jeeps, and the company has so far resisted the state’s invitation to retool the plant to assemble electric vehicles .
For decades, automakers have diversified out of the Midwest into states that lack Illinois’ strengths but offer lower costs and a more business-friendly environment. While Michigan remains No. 1 for auto manufacturing jobs, states like Kentucky, Tennessee, Mississippi and South Carolina have made inroads. It is a very competitive landscape.
Yet in many ways, the transition to electric vehicles plays directly to Illinois’ strengths, particularly its pool of well-educated workers. While car brands of the past were defined by power, handling and other mechanical attributes, today’s electric vehicles compete on both software and hardware. These new silent vehicles are essentially computers on wheels that feature selling points like state-of-the-art infotainment, voice controls and self-driving features.
Therefore, car manufacturing is increasingly dependent on high-end skills. Illinois has a high-end workforce, and the state is investing wisely in training programs for electric vehicles and other clean energy workers.
When do we see the reward?
Governor, show this vital and fast-moving industry that our state truly is the “best place” for their businesses to be home. Make everyone work to get some signature deals.
