RIP to the EV tax credit

Overview

This episode explores the economic implications of the GOP's decision to end the federal tax credit for electric vehicles (EVs), the rise of vertical integration among major retailers, the impact of tariffs on global trade, and shifting dynamics in the labor market. It also highlights Canada's first liquefied natural gas (LNG) shipment to Asia and its economic significance.

Notable Quotes

- Free trade has been dead and probably been dead for a while and isn’t looking good for any time in the near future. - Chad Bown, on the state of global trade.

- If you're going to build a manufacturing plant, you have to be pretty sure that you're going to get the return for the capital you're going to invest in that. - Kristin Schwab, on the challenges of vertical integration.

- We expect you to work 60, 70, 80 hours a week, and if you don’t like it, don’t apply. - Lindsay Ellis, summarizing the blunt messaging of some employers.

🚗 The End of the EV Tax Credit

- The federal EV tax credit, which has existed since 2008, will end on September 30 under the GOP's new tax law.

- The credit, up to $7,500 per vehicle, helped car manufacturers invest in EV production and made EVs more affordable for consumers.

- Experts predict the end of the credit will shift focus to the used EV market, as leased vehicles benefiting from the credit will soon become available.

- The tax credit's legacy includes spurring innovation in battery technology and supply chains, contributing to EVs reaching 8% of U.S. vehicle sales.

🏭 Vertical Integration as a Supply Chain Solution

- Walmart has opened its first beef processing plant, signaling a shift toward vertical integration to control costs and mitigate supply chain disruptions.

- Vertical integration allows companies to be more agile, reduce reliance on middlemen, and better manage pricing.

- However, it requires significant investment and is primarily viable for large, established companies with the resources to manage complex operations.

🌍 Tariffs and Global Trade Tensions

- Copper prices have surged, and tariffs on imported copper are set to rise to 50%, reflecting broader trade policy shifts under President Trump.

- South Korea faces 25% tariffs despite its free trade agreement with the U.S., raising concerns about the future of global trade.

- Canada is diversifying its natural gas exports to Asia, investing $30 billion in LNG infrastructure to reduce reliance on U.S. markets.

💼 Brutal Honesty in Job Postings

- Some companies are openly advertising roles with extreme work hours (e.g., 60+ hours per week), reflecting a shift in employer leverage in the labor market.

- This transparency aims to attract candidates aligned with the company culture while deterring those who prioritize work-life balance.

- Workers are increasingly weighing high salaries against demanding job expectations, with younger employees showing mixed preferences for in-office versus remote work.

🍅 Tariffs and Everyday Costs

- A decades-long tomato trade deal with Mexico is expiring, leading to a 17% tariff on imported tomatoes.

- The U.S. imports 72% of its fresh tomatoes, 90% of which come from Mexico, meaning consumers will likely face higher prices for this staple.