President Joseph R. Biden today signed an executive order declaring that up to half of all new cars sold by 2030 must be electric. Take a moment to spit out your coffee, do a double-take, or engage in whatever expression of surprise suits you.
Automakers had already begun setting ambitious targets around electrifying their fleets in the coming decade, some due to force (Volkswagen, thanks to the diesel emissions cheating snafu), others out of finger-in-the-wind intuition (General Motors, after jumping on board with the previous administration’s rollback of vehicle emissions standards), and several doing so simply due to the realization that mainstream buyers are shifting to electric vehicles more quickly than expected.
The headline figures are “40 to 50 percent,” as in, the administration is aiming for that percentage of new vehicles sold in 2030 to be electric. A number of automakers released statements alongside Biden’s executive order today pledging to work toward this goal, while also tying their participation to the pending $1 trillion infrastructure bill, which includes provisions for $7.5 billion in spending for a national network of EV charging stations.
Given how EVs currently make up only about two percent of the new-car market in the United States, the goal of reaching even the low end of Biden’s executive order—40 percent market penetration—in nine years seems almost as batty as decreeing that next year every American will need to wear clothing made exclusively from discarded banana peels. However …
Electric vehicles are gaining popularity more rapidly than many in the industry expected, largely due to Tesla’s ability to build EVs with “gotta-have-it” (our words) appeal. Hence why other automakers are diving into the space with EVs that sacrifice neither the style, speed, luxury, nor capability of their gas- and diesel-fed counterparts. Ford is introducing an electric version of its best-selling F-150 pickup; Porsche’s Taycan is a seductive, fast electric sedan; and even the righteously killed-off Hummer name is coming back as an electric sub-brand of GMC, which it’ll pin to a 1,000-hp EV pickup, as well as an SUV. Jeep is planning an electric Wrangler, Dodge is building an electric muscle car … we could go on and on.
Half of All New Vehicles Will Really Be Electric?
Read between the lines in the statements released today by Ford, GM, and Stellantis (formerly Fiat Chrysler Automobiles), the leaders of which were in support of Biden as his administration announced the E.O. in Washington, and there are a few caveats. Namely, the automakers include “fuel cell and plug-in hybrid vehicles” in their definition of what counts as an EV. Factor this little asterisk in, and Biden’s goal for 2030 car sales starts to look a little more achievable.
Nevertheless, the goal faces plenty of headwinds. As former President Donald J. Trump bluntly revealed when he tore up the aggressive emissions-reduction regulations introduced by his predecessor, President Barack Obama, executive orders like this are vulnerable to successive administrations’ whims. Remember, Obama had tried moving automakers toward a 51-mpg fleet-wide standard by 2025, then Trump came into office and promptly slashed the standard to about 44 mpg for 2026, prompting a standoff with California, which can set its own rules independent of the Environmental Protection Agency. (By the way, these mpg figures aren’t quite the same as the consumer-facing, EPA-estimated window-sticker figures, but rather generated using specific calculations.) As you probably surmised already, Biden has undone Trump’s undoing and then some, raising the industry mpg standard to 52 mpg by 2026. The administration plans to unveil even stricter standards beyond 2026.
Will any of this force a change in the auto industry? Perhaps, though it’s worth pointing out today’s pledges of support from automakers aren’t blood oaths. In other words, there’s nothing binding. As General Motors and others have previously couched their EV plans, each automaker could determine the marketplace lacks the demand necessary to achieve 40 to 50 percent electrification in the coming decade and, instead, simply continue building a vast majority of their vehicles with internal combustion engines. Customer adoption likely will play as much of a role in achieving Biden’s goal as regulations or mandates, which means expanding today’s charging network—whether by way of the massive infrastructure bill before the legislative branch or private enterprise—and bringing down the cost of appealing EVs are the real bogeys.
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