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When signing the Buy America executive order in late January, President Biden discussed his administration's push to transition government fleets to electric vehicles (EVs) of American origin. During the press conference, Biden situated this initiative as part of the administration's "Build Back Better" recovery plan and efforts to modernize infrastructure, according to CNBC.

Here's a look at the current state of fleet manufacturing and use, as well as what contractors can expect moving forward.

Government agencies account for 645,000 vehicles

As Biden explained during the press conference, "The federal government also owns an enormous fleet of vehicles, which we're going to replace with clean, electric vehicles made right here in America by American workers, creating millions of jobs."

According to the U.S. General Services Administration's 2019 Federal Fleet Report, the federal government owns and operates about 645,000 vehicles, which consume 375 million gallons of gasoline and diesel fuel per year. Of these vehicles, about 225,000 are operated by the post office and 173,000 are for the military.

New focus on Made-in-America fleets and contract opportunities for small businesses

President Biden aims for EV "net zero emissions" fleets that are produced using American parts and labor.

The administration noted that, in recent years, the federal government "spent nearly $300 million on foreign engines and on vehicles, instead of buying American vehicles and engines from American companies, putting Americans to work."

The appearance of U.S. Department of Defense (DoD) visual information does not imply or constitute DoD endorsement.The appearance of U.S. Department of Defense (DoD) visual information does not imply or constitute DoD endorsement.

To ensure government spending supports U.S. businesses, the Buy America executive order included appointing a new Director of Made-in-America at the White House Office of Management and Budget. Part of the director's purview will be to support more transparent and participatory procedures for U.S. businesses.

For instance, the procurement process is expected to carefully assess and publicize all waiver requests that favor foreign parts and products. This way, American manufacturers, including small businesses, can have the opportunity to offer up their services.

Under the current component requirements, vehicles manufactured for government use are intended to contain 50% American parts. Biden said new initiatives would close existing loopholes and ensure that the highest-value components — steel, engines, glass and so forth — are manufactured domestically.

An 'avalanche' of new EV offerings and auto jobs expected

This push toward electric fleets comes as part of Biden's clean energy mission to create 1 million new jobs across the automotive industry and "position America to be the global leader in the manufacture of electric vehicles and their input materials and parts."

This announcement is promising for the few EV manufacturers in the U.S. like Tesla, Lordstown and Rivian as well as longstanding companies like General Motors, Nissan and Ford, which are actively pivoting to invest in EV production. But industry experts forecast opportunities for U.S. businesses beyond these big-name companies.

"The current [EV] offerings are pretty slim, but the industry's about to unleash an avalanche of new product, and a lot of it built in North America," Kristin Dziczek, vice president of industry, labor and economics at the Center for Automotive Research, said in an interview with CNBC. "Just about every U.S. plant is going to have a hybrid or electric product."