NASHVILLE, Tenn. (WKRN) — General Motors announced this week it would cut thousands of jobs in Tennessee, Michigan and Ohio, including more than 700 furloughed workers at Ultium Cells, an EV battery plant in Spring Hill.

An associate professor of economics at Middle Tennessee State University, Steven Sprick Schuster, said the shake-up is a response to the end of a $7,500 federal tax credit for purchasing new electric vehicles. Those expired on Sept. 30.

"A few years prior, you had — through the Inflation Reduction Act — an expansion of those subsidies, specifically though for cars that were assembled in the United States," Schuster told News 2. "So that incentive, I think, created a rush of manufacturers trying to utilize that — therefore building or promising to build in the United States. Then, with the Big Beautiful Bill removing those subsidies, you have them walking back those exact things that they had promised."

Schuster explained the sudden switch-up in public policy from expanding EV tax credits to ending them has created whiplash across the electric vehicle industry. At the same time, he predicted long-term growth.

"I don't think that they [automobile companies] think that the EV production is just going to go away," Schuster added. "It's just this one massive thing that was incentivizing it to do it exactly this way is gone."

As auto companies respond to the changing EV landscape, the human toll of the temporary layoffs remains to be seen.

“What obligation do we have to the people whose jobs were destroyed, specifically through public policy?" Schuster said. "Not because of supply and demand, not because of the market… but because we created a policy that destroyed a job?”

A spokesperson for General Motors said furloughed employees at Ultium Cells may be eligible to continue receiving a “significant portion of their regular wages or salary, plus benefits.”  Ultium Cells said they hope to resume normal operations at the plant by mid-2026.

News Source : https://www.wkrn.com/news/local-news/mtsu-ultium-cells-ev-public-policy-shift/