Axios What's Next
August 17, 2022
What's the Battery Belt? Nothing short of a potential sea change in U.S. manufacturing, Joann reports today — with big implications for the future of electric vehicle production.
- Join Axios’ Ina Fried and Russell Contreras tomorrow at 12:30 p.m. ET for a virtual event examining the impact technology can have on reducing recidivism. Guests include The Last Mile co-founder Chris Redlitz and Justice Through Code founder and director Aedan Macdonald. Register here.
Today's Smart Brevity count: 1,039 words ... 4 minutes.
1 big thing: A jolt for the Battery Belt
The climate bill President Biden signed into law yesterday will open up tens of billions of dollars in subsidies for high-tech electric vehicle plants across the South and the Midwest, Joann Muller reports.
Why it matters: The package is a big down payment on addressing climate change and moving toward energy independence as the U.S. races to build a domestic supply chain for batteries and other critical materials.
- It could also be a major economic jolt for a large swath of the country some are calling the Battery Belt, where lots of EV-related factories and facilities are being built.
Driving the news: The auto industry has poured billions into new EV and battery manufacturing facilities across North America over the last couple years.
- Now automakers and battery suppliers will be eligible for billions of dollars in federal loans and tax credits to offset those costs and spur additional investments.
For example: The government will provide a tax credit of $35 per kilowatt hour (kWh) for each U.S.-produced battery cell.
- That's 35% of today's average cost.
There's also a tax credit for U.S.-produced battery modules — groups of cells bundled together that fit inside a battery pack.
- At $10/kWh, the credit would whack about one-third off the cost of assembling an EV battery pack, according to Bloomberg NEF.
Critical materials and minerals produced in the U.S. also get a 10% tax credit under the new law.
- That will help companies like Redwood Materials, which is investing $3.5 billion in Nevada for cathode and anode processing — essential work in the battery production process that's currently done mostly overseas.
There's also $2 billion in grants to retool existing auto plants to make clean vehicles, and up to $20 billion more in loans to build new factories.
The intrigue: And yet automakers aren't happy about the law, largely because its strict supply chain requirements mean far fewer electric vehicles will qualify for big consumer tax credits right off the bat.
Yes, but: Over time, reshoring battery production should drive down the cost of EVs — and lessen U.S. dependence on China.
- The optimists' view: By incentivizing a domestic EV component supply chain, the law will help reduce automakers' costs — and they'll pass those savings along to consumers in the form of cheaper electric cars.
Between the lines: In essence, the U.S. has shifted the incentives for EV adoption from consumers to manufacturers — instead of making electrics cheaper for car buyers, the new law rewards carmakers for building EVs with U.S.-made batteries.
- Lawmakers are not "just putting on new rules and saying, 'good luck.' They're putting tens of billions of dollars on the table to help [automakers] get there," said Joe Britton, executive director of the Zero Emission Transportation Association.
2. A big test for universal basic mobility
A handful of Pittsburgh residents are getting free access to shared e-bikes, scooters and public transit as part of a yearlong study into "universal basic mobility," Alex Fitzpatrick reports.
Why it matters: Transportation is a fundamental necessity for obtaining basic needs such as health care or education, or for getting to work — but the associated costs can be burdensome.
Driving the news: As part of the study — a joint effort by the city of Pittsburgh, Carnegie Mellon University and micromobility startup Spin — up to 50 low-income residents will participate for free in Move PGH, a pilot program that combines traditional public transit with shared bikes and scooters.
- Participants' travel behaviors and other info will be tracked over the course of a year to see how free transit affects their lives.
Be smart: Universal basic mobility is a more targeted offshoot of universal basic income, which calls for giving families a set amount of money every month to do with as they see best.
3. The country's best internships
Boeing, General Motors and Southwest Airlines are among the companies offering the country's best internship programs, per a new ranking from recruitment tech firm Yello, Alex reports.
Why it matters: Internships can be a great foot in the door and a chance to learn about a given industry — if they're done well.
- Internship programs, in turn, can help employers find promising young talent and develop more diverse worker pipelines.
Details: Companies apply to be considered for Yello's rankings; a panel of judges then looks at factors such as pay, diversity and whether interns tend to be offered full-time jobs.
4. Just one office day a week, please
Hybrid workers are opting for once-a-week office visits over two-, three- or five-day in-person workweeks, Bloomberg reports based on data from workplace occupancy firm Basking.io.
Why it matters: As pandemic concerns ebb, we're settling into a new normal around in-person office use.
By the numbers: Workers showing up in person for just one day a week accounted for half of office visitors globally in the second quarter of 2022, up from 44% the previous quarter.
- Two- and three-day visits accounted for about 35% of the total share, while four- and five-day visits made up about 15% (down from 21.5% in Q1).
The intrigue: Big companies are still trying to figure out how to lure people back into the office more often. Apple, for example, recently announced that workers need to show up in person on Tuesdays, Thursdays and a flex day determined by individual teams.
Alex's thought bubble: If I lived near an Axios office, I'd probably be there two days a week. But there's always the coffee shop.
5. The R-rated struggle
R-rated movies released this year have so far accounted for their lowest share of annual box office revenue in decades, Axios' Sara Fischer reports.
Why it matters: The trend appears to be self-reinforcing, influencing studios' decisions about what kind of movies you can see in theaters.
- R-rated films are increasingly being pushed to at-home streaming, while more family-friendly action and adventure franchises dominate theaters.
Details: The vast majority of movies that hit theaters over the past two years were rated PG-13, according to data from The Numbers.
- Every movie that grossed over $100 million in 2021 was rated PG-13, and every movie that has grossed over $100 million this year has been rated PG-13 or G.
Yes, but: There's hope for the adult fare yet. Sony’s "Bullet Train," which debuted earlier this month with an R rating, has grossed over $50 million domestically.
A hearty thanks to What's Next copy editor Amy Stern.
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