News Bite

EV batteries can’t survive a scratch — Reuters

If cost and range anxiety weren’t enough of a problem, EV collisions will be costly

After losing power for 10 of 14 days between the ice storm of late February and the thundersnow of early March, Cathleen Russ of Royal Oak testified to Michigan lawmakers that she “would not accept an EV right now if you gave me one.”

Russ lost two refrigerator loads of groceries and had to inconvenience friends by sleeping at their homes during the outage. An electric vehicle would have compounded her problems, she told lawmakers. With no reliable way to charge the vehicle, she would have been paying for Uber rides to and from work.

A report in Reuters last week points toward another problem for the electric vehicle: durability after a crash. Specifically, the electric vehicle’s battery is a problem.

Per Reuters’ March 20 report:

For many electric vehicles, there is no way to repair or assess even slightly damaged battery packs after accidents, forcing insurance companies to write off cars with few miles - leading to higher premiums and undercutting gains from going electric. ...

"We're buying electric cars for sustainability reasons," said Matthew Avery, research director at automotive risk intelligence company Thatcham Research. "But an EV isn't very sustainable if you've got to throw the battery away after a minor collision."

Jason Hayes, the Mackinac Center’s director of energy and environmental policy, told CapCon he sees worrying signs for the electric vehicle, despite government subsidies.

“We've recently learned that Ford will lose $3 billion on EVs this year, on top of $2 billion in losses last year,” Hayes said. “Those losses are happening even with profits on Ford’s far more reliable internal combustion engine vehicle sales and massive infusions of federal cash. For its part, GM is laying off hundreds of white-collar employees as it hemorrhages enormous amounts of capital into EVs and watches overall vehicle sales drop in this inflation-plagued economy.”

Hayes noted that “range anxiety,” or the fear that an EV won’t be able to get to Point B without recharging, along with the high price of the EV, is a barrier to mass adoption.

“If that’s not bad enough, customers are now having to face the fact that a minor fender bender could lead to the loss of their entire vehicle,” Hayes said. “Who knows what this is going to do to insurance rates? At what point will we admit this was a bad idea and stick with reliable and effective technologies?”

Gov. Gretchen Whitmer wants two million EVs on Michigan roads by 2030, and she has enlisted both the Michigan Public Service Commission and the Department of Environment, Great Lakes and Energy to advance that goal.

Michigan had 17,500 EVs registered in 2021, per the U.S. Department of Energy.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

News Story

Right-to-work repeal could make Michigan’s job slump worse

Whitmer orders more bloodletting to cure state’s anemic post-shutdown recovery

Thirty-four states have fully recovered from the job loss they suffered during the pandemic and pandemic-related shutdowns, but Michigan is not one of them. The recent repeal of the state’s right-to-work law is likely to make that situation worse.

Following Gov. Gretchen Whitmer’s COVID shutdowns, the state’s job recovery record has been ninth-worst among the states. The net number of jobs here is still 33,100, or 0.7%, below its pre-pandemic level.

The state saw a steep rise in employment from May through November of 2020, when the governor slowly began allowing businesses to reopen. The number of jobs dipped again from November 2020 to January 2021, when Whitmer once again limited gatherings and shut down many businesses.

Michigan’s economy has been adding jobs since January 2021, with the slowest growth coming between July 2022 and January 2023. From February 2022 to February 2023, the state added 91,700 job, a 2.1% increase. The seasonally adjusted unemployment rate for the United States was 3.6% in February 2023, but the rate in Michigan was 4.3% for the third straight month.

The unemployment rate could worsen with the repeal of right-to-work, according to a study published in April 2022.

Michael LaFaive, senior director of the Morey Fiscal Policy Initiative at the Mackinac Center for Public Policy, and Todd Nesbit, assistant professor of free enterprise and entrepreneurial economics at Ball State University, measured the impact of right-to-work laws in various states.

LaFaive and Nesbit collected employment data from 18 industrial sectors of the economy. The study found that counties had higher employment levels in several industries, as a percentage of total private employment, in jurisdictions that had right-to-work laws in 2018.

“Counties in non-right-to-work states that bordered right-to-work states often had substantially lower employment levels than their nearby counties over the border in right-to-work states,” the study found.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.