President Biden will soon finalize his proposed Buy American rule, which will require goods purchased with taxpayer dollars to be made up of at least 75 percent U.S. content.
The revised Buy American rule, first announced by the president last July, is intended to boost American manufacturing and reduce dependence on foreign nations to supply the U.S. with parts and components for vehicles, electronics and more.
The current iteration of the Buy America rule only mandates products are made up of 55 percent U.S. content. The revised rule will raise that figure to 60 percent in October of this year, before climbing to 65 percent in January 2024 and then 75 percent in January 2029.
The current rule also does not enable the U.S. federal government to follow up with a contractor to prove their products contain the required amount of American content. This will change under the revised rule, Biden said last year.
“First, 55 percent (US-made content) is not high enough, and second, contractors don’t have to tell us the total domestic content of their products,” Biden said when he first announced the Buy American revision last July. “They just have to tell us that they hit the threshold. With nobody checking. They’ve got a new sheriff in town. We’re going to be checking.”
This rule is particularly important to American automakers like Ford and GM, as the federal government is a major purchaser of vehicles for fleet use. Going forward, the Detroit Big Three must ensure their vehicles contain the right amount of American content, or they risk being left out of federal fleet purchasing orders.
Biden has also laid out plans to replace the entire federal vehicle fleet with EVs, so automakers that want to capitalize on this upcoming major federal fleet purchase will need to ensure their vehicles are made up of mostly U.S. parts and components. The feds will purchase only electric passenger vehicles by 2027 and will cease the purchase of all internal combustion engine vehciles for fleet use by 2035, Biden has claimed.