With the Electoral College now making him the official President-elect, Joe Biden continues moving toward filling up key government posts, and “Mayor Pete” Buttigieg will be his pick for U.S. Transportation Secretary, according to reports from Washington.
The former South Bend, Indiana mayor – and Biden’s former rival for the Democratic nomination – will oversee a vast transportation network dividing his attention between, rail, shipping, air and roadways. He will have to deal with not only collapsing infrastructure issues, but also the current and potential impact of new technologies including both autonomous and electrified vehicles.
“Never before has leadership in the DOT been needed so greatly,” said Carla Bailo, the CEO for the Center for Automotive Transportation in Ann Arbor, Michigan. “He will have a very full plate, just on the technology side. We need to deal with battery cars and driverless vehicles. And there’s been no investment infrastructure. We need to rebuild roads and bridges.”
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If approved by the Senate following Biden’s inauguration Jan. 20, 2021, the new Secretary of Transportation will, among other things, face a backlog of issues, including stalled rules and regulations, left by the Trump administration. Numerous posts were never filled during its four-year run, the National Highway Traffic Safety Administration, for one, operating without a permanent chief.
As a result, NHTSA has enacted few new rules and set few new standards. In many cases, that has left the U.S. as the odd country out in terms of adopting new and potentially safer technologies, such as the “smart” headlights now in use in much of Europe, Asia and even Canada, as well as sideview camera mirrors that could help improve fuel economy by reducing wind resistance.
NHTSA hasn’t been completely idled, one area where it did play an active role was the Trump administration’s highly controversial plan to roll back Obama-era Corporate Average Fuel Economy mandates, CAFE being jointly set by the DOT and the Environmental Protection Agency. The rollback has been tied up in court, along with another plan to strip California of its authority to set emissions rules used by that state to mandate mileage standards tougher than federal guidelines – and to promote rapid adoption of electric vehicles.
The Trump plan is widely expected to be abandoned under President Biden – but the new administration will also have to lay out plans for CAFE extending beyond 2026. How to handle new mileage mandates, as well as the debate
about the California exemption could prove tricky for the transportation secretary to negotiate.
“We would like one common standard” rather than separate federal and California standards, said Art St. Cyr, a senior Honda executive.
“I expect to see a collaborative approach, rather than a confrontational one” from Buttigieg, said CAR’s Bailo. That could see him push for a compromise between state and federal regulators, as well as the auto industry. And the fact that a number of automakers, including Ford, Volkswagen and General Motors, now support the California exemption, could make a deal possible.
The Obama administration broke ground by pulling together a historical compromise between safety advocates, regulators and auto manufacturers during its final weeks. As a result, the industry is rolling out automated emergency braking technology faster than would have been possible through the traditional rulemaking process. Several senior company insiders said on background they’d like to see a similar approach under the new administration.
Some of the issues facing the new White House team have been building for years, even decades. Both the Obama and Trump administrations identified the need to rebuild America’s roads and bridges as they came into office, but relatively little got done.
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American motorists clock an average 8.8 million miles a day on the road, according to DOT data, but the agency also found that 21.8% of U.S. roads are in poor condition, while 7.6% of bridges need replacement or repair.
Complicating matters, the Federal Highway Trust Fund has been running increasingly on empty during the past two decades, a situation compounded by the coronavirus pandemic. It has sharply reduced traffic and, with far less fuel being pumped, slashed trust fund revenues.
“The federal trust funds that pay for transportation projects (is) expected to run short of funds in the near future,” according to a report by the Senate Republican Party Committee released this past September.
How “Mayor Pete” handles emerging technology will be one of the defining issues of his tenure, according to some in the industry.
“There is a lot of new technology and it will be difficult for the industry to move forward without new standards and guideposts,” said Stephanie Brinley, principal auto analyst with IHS Markit.
That’s particularly true when it come to the autonomous and fully driverless vehicles the industry has begun testing, often on public roads. The DOT has so far failed to set guidelines, and proposed legislation has been tied up in Congress for several years. Without clarity from Washington, said Brinley, there is plenty of “risk” that progress will be slowed. Others warn the U.S. could lead its lead in the technology race to Europe, China or Japan.
During his run for the White House, Democratic candidate Biden was a strong proponent of electric vehicles, in strong contrast to Trump. Buttigieg will play a critical role in translating that backing into action, including the proposal to have 500,000 charging stations in place across the U.S. by 2030.
He could also lend support to ramping up tax credits for EV buyers. They can qualify for up to $7,500 in tax credits, but the current rules phase out those incentives when an automaker hits a modest threshold for sales. Tesla lost its credits last year and other automakers, including GM, Nissan and Ford, are now over or approaching the sales threshold.
EV proponents would like to see incentives, if anything, increased in a bid to shift the country away from the internal combustion engine.
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The DOT chief won’t be the only cabinet level officer having to deal with the auto industry. There will be trade and labor and broader environmental issues, to name a few. But, as head of the Department of Transportation, Buttigieg will have an outsized say on a variety of critical challenges likely to shape the direction of the automotive world for decades to come.