The auto industry doesn’t love admitting this, but it was really hoping that last year would be like the early 1970s were for color television—the point where a new technology takes off while an older one could begin to be phased out. With electric vehicles, adoption is proving to be less predictable than they wanted. Now many automakers want to dial back expectations for EV adoption. They’ve already convinced their shareholders. Their dealers work every day to dissuade consumers. And it’s certainly good for their balance sheets in the short term.
There’s only one group left to convince: regulators pushing for less emissions from cars, and ultimately a mostly electric future.
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The Great EV Rollback
Car companies are noticeably less optimistic about EV adoption in 2024, despite record-setting sales in 2023. Some blame consumer hesitance. Others blame dealer sabotage. Others still argue that many legacy-automaker EVs are just not competitive or underbaked. Either way, these companies want to hedge their bets in case they can’t get their own EV lines to a profitable, stable place.
Boy, are they trying. A new piece from Automotive News lays out the effort that automakers, suppliers, dealers, and the whole industry have put in to try to roll back regulatory expectations. The Biden administration is close to finalizing revised emissions guidelines to cover the next decade, and any company with a considerable fossil fuel business is working hard to leave room for a large number of ICE products.
The Environmental Protection Agency’s revised ruleset is likely to be more conservative in its timeline, expecting automakers to reduce fleetwide emissions by 56 percent between 2027 and 2032. That starts with an 18% reduction in 2027, with year-over-year reductions decreasing to 9% in 2031 and 11% in 2032.
The agency expects the tougher requirements to lead to a predominantly EV light vehicle market in the U.S., with full EVs representing 60 percent of new vehicle sales by 2030 and 67 percent by 2032. Automakers aren’t game for that.
As Automotive News reports, they are pushing for the EPA to go with a less strict plan called Alternative 3. The overall emissions target is the same—56% reduction by 2032—but Alternative 3 calls for a slower ramp-up, starting with an 11% reduction in 2027 and building to a 17% year-over-year reduction in 2032. The auto industry still isn’t excited about the timeline, but companies seem to prefer it to the alternative.
If you think this is only from the automakers who are behind on EVs, you’re unfortunately wrong. Take Kia, for example, one of the car companies arguably doing the best at EV tech and EV sales at the moment. “While Kia is optimistic that we can get to 60 percent electric vehicle penetration in the future, the proposed time frame of 2030 is not realistic,” the automaker told the EPA in comments over the rules last summer. “This timeframe is too fast given the uncertainties around EV affordability, EV charging infrastructure, and EV battery critical mineral supplies.”
On the less ambitious standards, Kia officials said: “To be clear, Alternative 3 proposed standard, achieving the same stringencies as the proposed standards in (model year) 2032, is still grossly overly optimistic. However, Alternative 3 at least provides for a more consistent rate of stringency and a more realistic slope of consumer acceptance over (model years) 2027 to 2031 than EPA’s other proposals.”
Essentially, the company supports that over the more aggressive plan the EPA is weighing, but still considers it “harmful” to the market. That’s coming from a company that’s relatively ahead of the game on EVs, showing that this attitude is pervasive in the industry.
Of course, it’s also worth remembering that automakers will never lobby for stricter standards. Their goal is to make money, and for now, their internal combustion trucks and SUVs are the breadwinners. Stricter goals mean less excess, fewer giant gas-guzzling SUVs, and fewer opportunities to cash in on the technology they’ve all refined over the last several decades. In the EV world they have to compete with upstarts like Tesla and, so far, that competition hasn’t gone the way they want it to go.
Unfortunately for them and the climate, dragging their feet is unlikely to solve that problem.
Contact the author: mack.hogan@insideevs.com