The end is nigh for gas-powered cars

On Wednesday, the Environmental Protection Agency plans to announce tough new tailpipe emission standards designed to effectively force the auto industry to phase out the sale of gas-powered cars. It’s an ambitious — and risky — move by the Biden administration to cement its climate goals by boosting the sale of electric vehicles while also ushering in the end of the era of the internal combustion engine (ICE).

But it won’t be as easy as banning the sale of gas-powered cars or mandating that companies only sell vehicles with electric powertrains. Rather, the new EPA rules would set an emissions limit on the total number of new cars each automaker sells in a year. That limit would essentially ensure that two-thirds of vehicles they sold in the US by 2032 would be EVs, according to a report by The New York Times. The full details are expected to be released on Wednesday.

The effort to make this a reality will be absolutely massive. Automakers have already set out on the path to more EV sales, but plug-in vehicles still only account for a fraction of the overall car market in the US. Getting them from where they are today, at around 7 percent of new car sales, to where the Biden administration wants them, roughly 68 percent of all car sales, will be unlike anything ever attempted in the 150-year history of the auto industry.

Take this past January for example: EVs made up 7.83 percent of new vehicle sales in the United States, with 66,416 battery electric vehicles and 14,143 plug-in hybrid vehicles sold. That same month also saw the sale of 950,000 new ICE light-duty vehicles, as well as approximately another 3 million used ICE vehicles. The EPA under President Biden is basically trying to flip those numbers.

None of this should come as a surprise, to policymakers or automakers, according to Chris Harto, senior policy analyst for transportation and energy at Consumer Reports. The EPA has been signaling that these new standards would be coming out this spring for a while now and are roughly in line with Biden’s climate goals. Right after taking office, the president signed an executive order laying out his vision for half of all new car sales to be tailpipe emissions-free by 2030.

As for how chaotic this shift will be, much will depend on how the auto industry responds, Harto said. “Technology transitions tend to get messy when companies fail to respond effectively to rapid shifts in consumer demand,” he said in an email. “Automakers that respond most nimbly to changes in consumer demand will be most successful, and those that don’t may find themselves rapidly falling behind.”

And, of course, we have California to thank for this new course of action. Last year, the California Air Resources Board issued new rules that were first rolled out by Governor Gavin Newsom in 2020, which would require 100 percent of new cars sold in the state to be free of carbon emissions by 2035. California is the largest auto market in the US and one of the largest in the world, and emissions rules adopted by the state tend to ripple out to the rest of the country.

Indeed, other states have since followed California’s lead in setting their own deadlines to phase out the sale of gas cars, including Maryland, Massachusetts, New Jersey, New York, Oregon, and Washington.

But inevitably, the federal government would have to take a different tact. President Joe Biden likely doesn’t want to open himself up to too much criticism by issuing an executive order that bans the sale of gas cars. The attack ads practically write themselves. And Republicans are already pushing back against the president’s push for increased EV sales, albeit somewhat incoherently. Instead, we’re getting “new light-duty vehicle greenhouse gas (GHG) and criteria emissions rules for model year 2027 through 2032” — which doesn’t exactly roll off the tongue.

The EPA’s proposal comes on the heels of new rules from the Treasury Department concerning which vehicles are eligible for a $7,500 tax credit passed as part of the Inflation Reduction Act of 2022. The new rules address outstanding issues related to the source of the critical minerals contained within an EV battery and are expected to result in fewer EVs qualifying for the credit.

Harto said the new rules will help synchronize federal rules with state efforts to restrict the sale of gas-burning vehicles, which will be good for companies and good for consumers. “For at least the next few years, the primary bottleneck on EV adoption is going to be vehicle supply,” he said. “Consumers can’t buy vehicles automakers don’t build. These standards will help ensure that automakers actually deliver the kinds of vehicles consumers want.”

The auto industry is already bracing itself for the big news. On April 6th, the Alliance for Automotive Innovation, which represents practically all the major car companies, fired off a memo to its members outlining what it knows about the EPA’s forthcoming rules.

The new rules “will result in significantly more stringent greenhouse gas and criteria emissions standards than ever before,” the Alliance states, while also touting all the money car companies claimed to have already spent or committed to spend (an estimated $1.2 trillion in total) on the EV transition.

The auto industry is proud of that figure; it talks about it a lot in its PR communications. And to be sure, it’s a big number! But automakers aren’t exactly embracing the administration’s effort to force a faster EV transition. Private interests rarely get excited about new regulations. Instead, they’re warning about a “challenging” future ahead as the administration’s rules go into effect.

“This requires a massive, 100-year change to the U.S. industrial base and the way Americans drive,” the Alliance memo concludes. “A clear-eyed assessment of market readiness is required. The answer on rule feasibility is: It depends.”

Of course, the EPA has larger concerns than whether the auto industry thinks its new rules will be feasible. Transportation is a major source of carbon emissions, and much of that is the result of tailpipe pollution. The climate crisis doesn’t care whether the auto market is ready or not. The future is being written right now, and for ICE vehicles, their days are numbered.