Bernie Moreno, the incoming Ohio Senator and 'car czar,' calls the EV tax credit 'catastrophically stupid.'

• As the Senator-elect in Ohio, Bernie Moreno aims to become the "car czar" in the Senate during the second Trump administration.
• At the CNBC CFO Council Summit in Washington, D.C. on Wednesday, Moreno stated that he does not support the $7,500 EV tax credit created by the Biden administration and believes consumers and automakers should decide what cars to buy or build.
• While EV sales are improving, auto makers are now shifting their plans to include a more balanced car lineup that includes EVs, hybrids, and gas-powered vehicles.

Bernie Moreno, a Republican Senator-elect who previously worked as a luxury car dealer and defeated Democrat Sherrod Brown in Ohio, stated that he intends to become the "car czar" in the Senate for the upcoming Trump administration.

If Moreno is to assume that role, one of his initial priorities would be to eliminate the up to $7,500 tax credit that can be utilized to purchase or lease an electric vehicle.

At the conclusion of the day, the $7,500 incentive is disastrously unwise, according to Moreno, who spoke to CNBC D.C. Correspondent Emily Wilkins at the 2024 CNBC CFO Council Summit in Washington, D.C., on Wednesday.

Some senators, such as Michigan's Elissa Slotkin, have framed their support of the tax credit for electric vehicles as a defensive move to aid the auto industry in its competition with Chinese manufacturers.

Wilkins was informed by Moreno that he believes that stance to be "nonsense," asserting that the government should not dictate companies' strategies.

"If you don't mind what type of car people drive, then let the market decide," Moreno stated. "If it's an electric car, that's fine."

Moreno countered the claim that eliminating Inflation Reduction Act incentives, such as the EV tax credit, would give China a competitive edge in the race for key technology. He argued that if China is leading in electric vehicles, that's great; we are leading in combustion and hybrid technology.

"What is your preference as a country for our industry to go? Should we focus on maintaining our strategic advantage or allow an industry to be handed over to China? Moreno stated that the change in U.S. law regarding EV incentives is not a handover but rather a reflection of consumers' preferences."

""Consumers have been more clear about their preferences for EVs, with some finding them beneficial and others not interested in purchasing them," Moreno stated."

Major auto manufacturers, including BMW, Ford, and General Motors, have scaled back or delayed some electric vehicle plans, resulting in a decline in the euphoria surrounding EV investment and sales.

Although electric vehicle sales are predicted to rise in the near future, the surge in consumer demand for EVs that many car executives anticipated did not occur. According to Marin Gjaja, chief operating officer for Ford's EV unit, "What we observed in '21 and '22 was a brief market surge where the demand for EVs increased significantly." However, the growth rate is still expanding, but not as quickly as expected.

Instead of concentrating solely on plans to become all-electric by 2035, as laid out by GM CEO Mary Barra, automakers are now focusing on a more diverse range of vehicles, including gas-powered cars, hybrids, and EVs.

"We'll create a favorable business climate for car companies by providing a good tax, regulatory, and workforce environment. Let the marketplace handle things; we should stop interfering with corporations and the market will take care of it, as Moreno stated."