Biden Slows, Not Reverses, Unpopular EV Mandates In Election Year Gimmick

In a concession to automakers and labor unions during an election year, the Biden administration plans to relax elements of its regulations to limit tailpipe emissions that are designed to get Americans to switch from gas-powered cars to electric vehicles.  Biden’s EPA is planning to give automakers more time to ramp up sales of electric vehicles. The revised regulations would not require a sharp increase in EV sales until after 2030. The final rule is expected to be published by early spring. The auto industry and unionized auto workers backed Biden in the 2020 election but they now worry that Biden’s abrupt transition to electric vehicles would result in a loss of jobs. Further, consumer demand for electric vehicles has been waning, with potential buyers put off mainly by high vehicle prices and associated costs as well as the lack of charging stations.

Last spring, the Environmental Protection Agency proposed the toughest-ever limits on tailpipe emissions, forcing car makers to sell a huge number of zero-emissions vehicles in a relatively short time frame or pay stiff penalties. The EPA designed the proposed regulations so that 67 percent of sales of new cars and light-duty trucks would be all-electric by 2032, up from 7.6 percent in 2023, a radical remaking of the American automobile market. The regulation was designed to match Biden’s goal that 50 percent of new car sales must to be electric by 2030. EPA’s plan for the final regulations, however, is to have electric vehicle sales increase more gradually through 2030 but then to rise sharply.

The change is to mollify automakers who want more time to build a national network of charging stations and to bring down the cost of electric vehicles, and to labor unions that want more time to try to unionize new electric car plants that are opening around the country, particularly in the South. Biden needs auto union backing for this election, which was threatened last spring, when the Environmental Protection Agency proposed the new limits on tailpipe emissions. Soon after, Shawn Fain, president of the United Auto Workers, wrote that the union was withholding its endorsement of Mr. Biden’s re-election bid over “concerns with the electric vehicle transition.” The union has been wary of electric vehicles since they require fewer workers to assemble and many electric vehicle plants are being built in states with few unions. In public comments it filed regarding the proposed rule, the United Auto Workers pressed the Biden administration to relax the compliance timeline so that it “increases stringency more gradually, and occurs over a greater period of time.” In early January, the EPA sent a revised version of its auto emissions rule with the longer time frame to the White House. After receiving it, the United Auto Workers endorsed Mr. Biden. The EPA’s decision was clearly political, rather than based upon science as it had claimed.

Despite a record 1.2 million electric vehicles that were sold in the United States last year, EV growth is slowing, making the nearly tenfold increase in sales within just eight years that EPA regulations would require infeasible. The slowdown in EV sales is to be expected, as the market for early adopters — typically wealthier, coastal urban residents who have bought an electric vehicle as a second car — is saturated.

While buyers of new electric vehicles are eligible for up to $7,500 in federal tax credits, only 18 models are currently eligible for the full credit, down from about two dozen last year. One of those eligible models, the Ford F-150 Lightning, an all-electric pickup truck that once had a waiting list of 200,000, last year saw sales of 24,000, far short of the 150,000 sales projected by Ford. And while construction of EV chargers is expanding, nearly doubling from about 87,000 in 2019 to more than 172,000 last year, more than two million chargers will be needed by 2030 to support the growth in electric vehicles required by the proposed rules.

Auto companies have invested about $146 billion over the past three years in researching and developing electric vehicles. If the regulations as currently defined were implemented, auto companies would face billions of dollars per year in fines if the emissions associated with their auto sales exceed the limits set by the regulators.  These costs are being covered by price increases for vehicles consumers actually want, driving their prices higher.  This is already happening as new car prices have hit record highs. Even non-EV purchasers are paying the price for Biden’s EV dreams.

EPA models show that postponing the sharp increase in electric vehicle sales until after 2030 would eliminate roughly the same amount of auto tailpipe emissions as the original proposal by 2055. According to Ali Zaidi, Biden’s senior climate adviser, Biden’s climate policies, combined with record federal investment in renewable energy, would still reach the president’s goal of cutting the country’s greenhouse gas emissions in half by 2030.

Conclusion

President Biden is reacting to an election year situation when he decided to slow the push for EV sales required by his regulations because he needs the votes of union members to get reelected. Not only does the EPA have a tailpipe emissions regulation that requires two-thirds of new car sales in 2032 to be electric, but the Department of Transportation’s Corporate Average Fuel Economy proposed standards require the same outcome and will need to be changed in concert with the EPA rule. This clearly shows that both science and safety are no longer relevant to either EPA or the NHTSA, and instead, their decisions are purely political.

Car manufacturers recognize that sales growth in electric vehicles is slowing and that more time is needed for consumers to adjust to the EV transition. Further, for more adoption of electric vehicles, prices need to come down, more charging stations need to be built, vehicle range needs to be improved as well as the battery technology that guides it, and insurance costs need to be more commensurate with those of traditional vehicles.

*This article was adapted from content originally published by the Institute for Energy Research.