Policy and Legal

A big majority of manufacturers expect AI to become essential to their operations by 2030—but they need policymakers to support all that growth and innovation, as a new report from the Manufacturing Leadership Council, the NAM’s digital transformation division, lays out.

By the numbers: The report found that 51% of manufacturers already use AI in their operations.

• Meanwhile, 61% expect investment in AI to increase by 2027.
• That number only grows as manufacturers look further into the future. By 2030, 80% say AI will be essential to growing or maintaining their business.

Current barriers: Right now, manufacturers say some barriers prevent them from implementing AI to its fullest potential.

• They name data quality and availability as the top challenges, with 65% of respondents reporting they lack the right data for AI applications and 62% citing data that is unstructured or poorly formatted.

The policy angle: Manufacturers don’t just need to overcome the technical, logistical or workforce challenges of rolling out AI solutions—challenges that include everything from modernizing data architectures to upskilling and training workers on new tools. They also need a pro-growth policy framework, which the NAM has supplied for policymakers. The key recommendations are:

• Adopt a pro-AI regulatory approach: Given the growing number and variety of use cases of AI in manufacturing, the industry requires an optimized regulatory environment.
• Develop the manufacturing workforce of the AI age: Policymakers should support training programs, career and technical education institutions and STEM education and immigration. According to the MLC’s report, 82% of manufacturers cite a lack of AI-ready skills as the top workforce challenge.
• Advance energy and permitting reform: AI needs a lot of power, and energy and permitting reform is necessary to support AI-related data center growth.
• Protect personal data: Congress should pass a comprehensive privacy law that preempts state laws, provides liability protections that prevent frivolous litigation and adopts a risk-based approach that enables innovation and AI.
• Support U.S. manufacturing of AI chips: Policymakers should execute funding agreements with chip manufacturers and renew the Advanced Manufacturing Investment Credit.
• Incentivize U.S. AI innovation: Congress must pass the One Big Beautiful Bill Act that preserves pro-manufacturing tax policies.

Manufacturers say: “AI continues to drive innovation, efficiency and better outcomes for manufacturers across America. From accelerating drug discovery and development to optimizing manufacturing operations, AI enables companies to make smarter, faster and more impactful decisions,” said Johnson & Johnson Executive Vice President and Chief Technical Operations and Risk Officer and NAM Board Chair Kathy Wengel.

• “Importantly, AI empowers employees at all levels, when we equip them with the knowledge and understanding to help shape the implementation of these new technologies. AI is proving to be an essential partner on the shop floor, and we must continue to ensure manufacturing employees have the skills they need to build the future of our industry.”

The last word: “The latest report from the MLC reinforces the need for modernized, agile, pro-manufacturing AI policy solutions, so that manufacturers can continue to innovate on shop floors across America,” said NAM President and CEO Jay Timmons.

• “Manufacturers welcomed President Trump’s early commitment to maintaining and advancing America’s global AI dominance, and we look forward to continuing to champion American AI leadership and manufacturing in America, which starts with adopting a pro-AI regulatory framework and pursuing policies that bolster innovation.”

The U.S. Court of International Trade, which hears disputes involving international trade and customs laws, struck down President Donald Trump’s International Emergency Economic Powers Act tariffs yesterday.

What happened: In a unanimous opinion, the three-judge panel found that the IEEPA “does not authorize the President to impose unbounded tariffs” and the administration exceeded its authority in imposing the “reciprocal” and fentanyl IEEPA tariffs.

What it means: The finding strikes down the 10% baseline additional “reciprocal” tariffs announced on April 2 as well as the “reciprocal” tariffs of between 20% and 50% on another 65 or so trading partners with which the U.S. runs trade deficits.

• Those tariffs that are currently “paused” were scheduled to snap back into place on July 9 if trade deals were not reached by then.
• The court further nullified the 25% fentanyl IEEPA tariffs on products from Canada and Mexico and the 20% fentanyl IEEPA tariff on products from China.

Refunds? The court also ordered that the IEEPA tariffs collected so far be “vacated,” raising questions about possible refunds.

• The court gave Customs and Border Patrol 10 days to implement the ruling, but the U.S. government may ask for a stay of enforcement—relieving the government of obligation to issue refunds—pending appeal, which could result in CBP continuing to collect but not liquidate tariffs.

An appeal: The DOJ quickly filed an appeal with the U.S. Court of Appeals for the Federal Circuit, and said that it may ask the Supreme Court to pause the ruling as soon as Friday.

Section 232: The ruling does not affect other tariffs the administration has or might impose under Section 232 of the Trade Expansion Act of 1962 on national security grounds.

• NAM filed comments on recent Section 232 tariff investigations into imports of copper, lumber, semiconductors, pharmaceuticals and critical minerals. It also plans to file comments on aerospace.

The U.S. Supreme Court rejected an appeal by a Native American group that would have halted the development of North America’s largest copper mine, a partnership between Rio Tinto and BHP Group (Bloomberg, subscription).

The situation: The appeal attempted to prevent the transfer of federal land to the mining project, due to the religious significance of one area to some members of the San Carlos Apache Tribe.

Why it matters: This site is the third-largest known copper deposit in the world and will be instrumental in the efforts—led by the Trump administration and backed by the NAM—to increase domestic sources of key minerals.

• “Projects such as Resolution have been tied up in legal challenges for years, making the U.S. one of the most challenging places to develop new mines,” Bloomberg noted.

The benefits: “The companies say the mine would supply as much as 25% of U.S. demand and as much as 40 billion pounds of copper over 40 years amid a soaring need for the metal in electric vehicles.”

Next steps: The land transfer may occur as soon as June 16, once the U.S. Forest Service issues a mandatory draft environmental impact statement and record of decision. The companies are still awaiting several federal, state and local permits, however.

The NAM says: “Manufacturers are eager for Resolution Copper to get underway to support strong domestic supply chains of critical materials after years of permitting delays, as well as to create thousands of high-paying jobs,” said NAM Vice President of Domestic Policy Chris Phalen. “The U.S. has an acute need for more mineral production and processing capacity. Policymakers should work to support many more such projects.”

Washington, D.C. – The National Association of Manufacturers today welcomed President Trump’s latest executive orders to expand the development of nuclear energy, streamline federal permitting and strengthen domestic fuel production. NAM President and CEO Jay Timmons issued the following statement:

“These actions mark an important and timely step toward unleashing American energy dominance safely and responsibly. Nuclear-generated power is an important part of an all-of-the-above energy strategy, which is necessary to meet the power needs of a growing manufacturing sector, and the nuclear fuel supply chain is a critical manufacturing industry that we need to bring home.

“The executive orders include measures to accelerate the licensing of next-generation nuclear reactors, open federal lands for energy infrastructure and increase domestic uranium production. Together, these actions address critical supply chain challenges and energy demands—particularly as the AI-driven economy continues to grow.

“Rebalancing regulations and expediting permitting reform to unleash American energy are key pillars of a comprehensive manufacturing strategy that Congress must act on so manufacturers can grow, hire and compete—and these orders reflect that vision by reforming the licensing and permitting systems that place burdens on manufacturers.

“The NAM looks forward to working closely with the National Energy Dominance Council, under the leadership of Secretary of the Interior Doug Burgum and Energy Secretary Chris Wright, as well as Congress to ensure these policies translate into durable results for manufacturers.”

Background:

Most recently, support for nuclear energy in the U.S. has climbed to 61% according to Gallup, reaching just one point below the all-time high in 2010. Support for accelerating the development and commercialization of both traditional nuclear energy plants as well as advanced modular reactors is vital to America’s energy future and the success of manufacturers in the U.S.

The NAM has long championed policies that drive investment in advanced nuclear power to meet rising U.S. energy demand fueled by electrification, advanced manufacturing and the surge in AI and data centers.

These include:

• Reforming the permitting and approval process to make it easier for reactor projects to locate on underused or abandoned sites;
• “Early licensing work” provisions to help deploy reactors more quickly at national security infrastructure sites; and
• A series of awards to encourage companies to develop advanced-reactor technology.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.93 trillion to the U.S. economy annually and accounts for 53% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

Washington, D.C. – Following House passage of H.R.1, the “One Big Beautiful Bill Act,” National Association of Manufacturers President and CEO Jay Timmons issued the following statement:

“Today’s House passage of this historic legislation marks a major victory for manufacturers across America. This pro-growth legislation preserves crucial tax policies that will enable manufacturers to create jobs, invest in their communities, grow here at home and compete globally. In short, this is a manufacturers’ bill.

“Manufacturers commend House Speaker Mike Johnson, House Majority Leader Steve Scalise, House Ways and Means Committee Chairman Jason Smith and the House for advancing this critical legislation, and we urge the Senate to act swiftly to build on this momentum.

“The stakes are high: preserving tax reform will prevent the loss of 6 million jobs and avoid a $1 trillion hit to the economy. Manufacturers urge the Senate to maintain the pro-manufacturing policies in the House bill while continuing to work with manufacturers to ensure the final package is maximally effective at supporting manufacturing investment here in the U.S.

“This is a pivotal moment. It’s time to double down on policies that encourage manufacturers to invest and create jobs in America and keep our industry strong and our nation competitive on the world stage—because when manufacturing wins, America wins.”

Background:

To preserve a pro-manufacturing, pro-growth tax code, the House reconciliation bill approved today would:

• Increase the pass-through deduction for small and medium-sized manufacturers and make this important deduction permanent, freeing up capital for businesses to invest and create jobs;
• Make permanent the competitive individual tax rates established by tax reform, benefiting the 96% of manufacturers organized as pass-throughs that pay tax at these rates;
• Increase and make permanent tax reform’s estate tax exemption, protecting more family-owned manufacturers’ assets from the estate tax;
• Reinstate immediate R&D expensing, reducing the costs of groundbreaking research and supporting innovation across our sector;
• Revive full expensing for capital equipment purchases, enabling manufacturers to purchase new machinery and expand their shop floors;
• Restore a pro-growth interest deductibility standard, enhancing manufacturers’ ability to pursue job-creating projects;
• Create an incentive for manufacturers’ investments in new and refurbished facilities, supporting factory construction here in the U.S.;
• Preserve tax reform’s international tax system by making the FDII, GILTI and BEAT regimes permanent, enhancing America’s competitiveness on the world stage; and
• Protect the 21% corporate tax rate, ensuring America remains the best place for manufacturing investment and job creation.

The NAM recently launched a new ad featuring small and medium-sized manufacturers from across the country thanking Chairman Smith and the whole committee for championing the policies in the bill most critical to the manufacturing industry.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.93 trillion to the U.S. economy annually and accounts for 53% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

Manufacturers are looking for a return to common sense by the Occupational Safety and Health Administration. The House Subcommittee on Workforce Protections held a hearing on Thursday titled “Reclaiming OSHA’s Mission: Ensuring Safety Without Overreach,” at which President of CRH Americas Materials’ Northeast Division Jake Parson represented the NAM’s and manufacturers’ positions.

The big picture: “If we want to grow manufacturing in the U.S., we need to rebalance regulations that cost manufacturers $350 billion every year. This is money that could be spent on hiring people, building new facilities and creating new products,” Parson said.

• “OSHA has put forward costly rules that ignore the complexity of U.S. manufacturing.”

One regulation: “One problematic regulation is the proposed heat rule. A one-size-fits-all heat standard ignores the work manufacturers already do to protect our employees, and it ignores the unique ways in which it is done,” said Parson.

• Rules that make sense for one region do not make sense for another, he noted.
• “During my time leading an asphalt production and paving business in Texas, I saw firsthand how extreme heat impacts our teams and how local expertise and adaptive safety measures are critical. Now, overseeing similar operations in the Northeast, I face a completely different climate and set of challenges. Any standard must reflect the realities of our industry and the diverse environments in which we operate.”
• “The proposed rule imposes significant mandates on manufacturers—without fully grappling with or understanding whether they are feasible or cost effective. The result would be reduced production and ultimately fewer jobs,” Parson warned.

The NAM’s involvement: The NAM has long advocated for commonsense OSHA regulations that protect workers while accurately accounting for manufacturers’ extant safety procedures and operational needs.

• The NAM weighed in on the heat rule back in January, advising OSHA that “the NAM recommends that OSHA provide additional flexibility that reflects the breadth of work environments and company approaches to the issues,” among other changes.
• In the hearing Thursday, policymakers also discussed the worker walkaround rule finalized by the Biden Labor Department last spring. The NAM is suing to block this overreaching and legally dubious regulation that does nothing to improve safety.

The last word: “The NAM continues to bring manufacturers’ voices to policymakers as they decide how best to protect workers and ensure manufacturing competitiveness,” said NAM Director of Transportation, Infrastructure and Labor Policy Max Hyman. “Real-world experiences from the shop floor help craft policy that empowers employees and grows the economy.”

The NAM is continuing to advise policymakers on the opportunities and hurdles facing the industry as it seeks to support AI innovation. This week, the NAM responded to a request for information from the House’s AI and Energy Working Group, led by Rep. Julie Fedorchak (R-ND), addressing concerns about “American energy dominance and artificial intelligence’s energy demands, securing the energy grid and outpacing and outcompeting China.”

The big picture: “With the digitalization of manufacturing … manufacturers are increasingly dependent on a robust network of cutting-edge data centers for the smooth execution of their core business operations. AI in particular has become integral to modern manufacturing, as it increasingly transforms and supports a multitude of aspects of manufacturing, from product design to shop floor operations to supply chain management.”

• “Manufacturers also rely on the same energy sources as data centers to power their operations. As demand grows and supply remains relatively static, there is a pressing need to use all policy levers available to ensure sufficient, reliable, resilient and affordable energy for all users.”

Permitting reform: The NAM’s first recommendation to the working group was that policymakers must enact permitting reform—and fast. “Wood Mackenzie has predicted that U.S. demand for power could increase by 15% by the end of this decade,” the NAM noted.

• The NAM advised policymakers to take certain crucial steps, including expediting judicial review, accelerating the permit process for energy infrastructure—including more transmission and distribution lines, pipelines and permanent carbon sequestration sites—and providing greater regulatory certainty.

A secure electric grid: Manufacturers are concerned about service disruptions caused by severe weather and aging infrastructure, the NAM said. “A reliable, resilient modern grid is required to enable the historic growth in data centers—which in turn can contribute to manufacturing growth.”

• The NAM recommended the build-out of natural gas generation and transportation infrastructure, as well as the permitting and construction of more transmission and distribution, as mentioned above.

The AI future: Manufacturers also recognize the importance of enabling AI innovation and the risks of imposing an overly restrictive regulatory regime on the fast-evolving technology.

• To that end, the NAM recommended “a regulatory approach that is based on reviews of existing regulations before enacting new ones … a strategy of international engagement that keeps foreign markets open to the use of American AI … and developing the manufacturing workforce of the AI age by supporting science, technology, engineering and mathematics education programs at all levels,” among other policies.

The last word: “Maintaining a favorable policy environment for AI will provide certainty to the private sector, which in turn will spur additional multibillion-dollar investments in U.S. manufacturing and innovation,” said NAM Managing Vice President of Policy Charles Crain.

The Environmental Protection Agency has announced that it will reconsider certain aspects of the Biden administration’s rule setting limits on PFAS, or perfluoroalkyl and polyfluoroalkyl substances, in drinking water—while leaving in place unworkable standards for two PFAS (The Washington Post, subscription).

Encouraging progress: The agency plans to reconsider regulatory determination for PFHxS, PFNA, HFPO-DA and PFBS following calls by the NAM to rescind the “blatantly unlawful” standards. The EPA also will extend its compliance deadline for PFOA and PFOS from 2029 to 2031, another top NAM ask.

More to be done: NAM President and CEO Jay Timmons made clear that the EPA’s decision to maintain the previous administration’s standards for PFOA and PFAS “go against the Trump administration’s goal to make the U.S. the best place to build, grow and create jobs.”

The NAM’s involvement: The NAM opposed these standards when they were instituted, arguing that the timeline for implementation was too swift, as many of these chemicals are key manufacturing additives that do not yet have replacements.

• The NAM also challenged the rule in court, asking the U.S. Court of Appeals for the D.C. Circuit to overturn the rule due to the EPA’s failure to follow the requirements of the Safe Drinking Water Act, including its reliance on a deeply flawed cost-benefit analysis and deficient feasibility analysis.

The NAM says: “We’re encouraged that the EPA has listened to the voices of manufacturers and extended the compliance deadline for unworkable national primary drinking water standards for PFOA and PFOS and committed to reconsidering the blatantly unlawful regulatory determinations for several other PFAS compounds,” Timmons said.

• “However, the Biden-era standards for PFOA and PFOS are deeply flawed, the costs they impose exceed any demonstrable benefit and the industries they harm include those vital to our national interests, including semiconductors, telecommunications and defense systems.”
• “We don’t have to choose between supporting manufacturing and clean water in our communities.”

Key House Committees this week advanced pro-manufacturing provisions that will make up the “one big, beautiful bill” that President Trump and House Republicans are advancing through the congressional reconciliation process—bringing the package another step closer to a vote.

What’s going on: The House Ways and Means Committee advanced legislation to make permanent crucial tax measures from the 2017 tax reform bill, while the House Energy and Commerce Committee approved a bill with much-needed permitting reform and energy provisions.

NAM in the driver’s seat: The NAM has been leading the campaign to extend and make permanent pro-manufacturing tax policies. Each of the NAM’s tax priorities was included in the legislation approved by the Ways and Means Committee—along with additional pro-manufacturing provisions. In advance of the markup, the NAM made clear that the bill “will protect manufacturers from devastating tax increases and empower the industry to invest, grow and create jobs here in the United States.”

• Manufacturers were top of mind for policymakers during the session. In his opening statement, Ways and Means Committee Chairman Jason Smith (R-MO) cited the testimony of Courtney Silver—president and owner of North Carolina–based family-owned precision machining firm Ketchie and a member of the NAM Executive Committee—as an example of the benefits of the 2017 tax reform.

Ways and Means: NAM priorities featured in the Ways and Means bill include:

• Tax certainty for small and family-owned manufacturers, including a permanent increase in the pass-through deduction and permanent individual tax rates and protections from the estate tax;
• Revived investment and innovation incentives for R&D, capital equipment purchases and debt financing, with additional support for small and medium-sized manufacturers and a new incentive for factory construction and refurbishment; and
• The preservation of the corporate tax rate and tax reform’s international tax system.

Ahead of the successful markup of the tax legislation, the NAM emphasized that failing to preserve these provisions “will cost the U.S. economy nearly 6 million jobs.”

Energy and Commerce: The NAM’s priorities were also front and center at a markup of the Energy and Commerce Committee, which has jurisdiction over the health, energy and technology provisions in the reconciliation package. The NAM voiced support for several key manufacturing priorities in the legislation, including:

• Pharmacy benefit manager reforms that will increase transparency and prevent PBMs from driving up health care costs for manufacturing workers;
• Permitting reforms that will allow for the buildout of much-needed pipeline and energy transportation infrastructure; and
• Provisions to rebalance burdensome environmental regulations that have harmed manufacturers’ ability to grow.

The NAM also welcomed the committee’s recognition that regulations should support manufacturers’ development and use of artificial intelligence—rather than slowing progress via “a patchwork of divergent state laws and regulations.”

How to add more rocket fuel: The NAM also offered suggestions to improve the bills, highlighting potentially harmful changes to strategic manufacturing incentives in the tax code—including ending the hydrogen production tax credit, imposing overly harsh restrictions on manufacturing and energy production regarding foreign sourcing and licensing which will keep manufacturers from bringing back supply chains and know-how to America, and ending credit transferability—as well as a provision targeting foreign headquartered manufacturers investing in the U.S.

• The NAM emphasized that manufacturers have used these targeted energy and manufacturing incentives to invest billions and employ thousands across the country.

What’s next: The committees’ bills will now be combined by the House Budget Committee in advance of a House floor vote in the coming weeks.

The bottom line: NAM President and CEO Jay Timmons underlined   the importance of this bill on NewsNation this morning. “If we really want to supercharge our economy and provide the rocket fuel that the president’s talked about in the past … [We have] to get [these tax provisions] reenacted. … [The] longer we wait, the harder it is for businesses to make decisions based on tax policy for 2026, so we want to see Congress move this really expeditiously so we can plan for investment and job creation in the next few years, too.”

• “[T]he priorities I believe that we all need to embrace are making sure that we are investing in creating new facilities for manufacturing, growing jobs and, most importantly, growing wages. That leads to a much more productive and successful society.”
• “There are some things that the House didn’t do that we hope the Senate does to ensure that we have the ongoing investments for energy infrastructure and other energy projects here in the United States,” he added.
• Policymakers’ main priority should be “policies [that] encourage businesses to invest here, to make it possible for them to invest here and to create jobs here,” he concluded.

The Federal Energy Regulatory Commission has issued a new final supplemental environmental review for Venture Global’s CP2 liquefied natural gas project in Louisiana, bringing it a step closer to reality (E&E News, subscription).

What’s going on: FERC found that “the terminal and an associated compressor station wouldn’t cause ‘significant cumulative air quality impacts.’”

The project: “The CP2 facility has a nameplate liquefaction capacity of 20 million metric tons per year, but it could produce even more under peak conditions.”

• If approved expeditiously, the project could produce its first LNG by 2026, the company said last year.
• “With today’s [final environmental impact statement,] FERC has found twice-over that CP2 will have no significant air impacts,” Venture Global spokesperson Jess Szymanski said in an emailed statement to E&E News. “The project is ready to break ground and begin supplying U.S. allies with much-needed LNG as soon as the FERC Commission votes on the Final Order and issues a notice to proceed with construction.”

What’s next: The Final Order is slated for July, according to FERC’s website.

The NAM says: “LNG projects like Venture Global’s will help bolster the American economy by creating jobs here at home and enabling the U.S. to achieve energy dominance on the world stage,” said NAM Director of Energy and Resources Policy Michael Davin.