In one breathtaking regulatory fiat, the Biden Administration revealed its plan to seize control of the nation's automobile industry. General Motors and Ford will no longer be free to sell cars and trucks consumers want. The government will compel the auto firms to manufacture and sell electric vehicles.
The industry takeover is disguised as new Environmental Protection Agency (EPA) emission standards for automobiles and trucks. The proposal authored by unelected bureaucrats would effectively force automakers to increase their sales of electric vehicles, while eliminating gasoline powered models.
Under the EPA directive, the agency anticipates that the emission standards will result in two-thirds of the vehicles sold in the U.S. to be electric by the 2032 model year. The federal bureaucrats forecast the stringent standards will mean 46% of medium duty trucks would be electric.
The EPA directive, styled after California's punitive edict, stops shorts of outlawing gas-powered vehicle sales. California's policy bans gasoline trucks and cars sales in the state by 2035. The Draconian measure will lead to higher prices for electric vehicles and fewer consumer choices.
Agency administrator Michael Regan bragged his proposal exceeds the administration's own 50%EV target by 2030. Environmentalists cheered the ambitious target but others warned the goal is unrealistically achievable. Electric cars represented less than 6% of the total new vehicle sales in 2022.
In nine years, the $1.53 trillion automotive industry will have to retool manufacturing and supply chains while building an ecosystem that doesn't exist at scale today. But Washington's desk jockeys likely have never set foot in an automobile manufacturing plant. They don't see any flaw in their scheme.
Office bureaucrats are impatient with the free market auto industry. Although the transition to electric vehicles is moving relatively fast, they believe auto makers are making too many gas models to satisfy customers. Consumers are just too dumb to embrace electric, the bureaucrats surmise.
The feds are growing restless after offering generous tax credits for years to seduce customers into scrapping their gas vehicles for electric cars. Taxpayers are footing the bill for this benevolence, which currently includes subsidies ranging from $2,500 to $7,500 depending on the electric model.
The average cost of an EV in 2022 was $61,448 compared to $49,507 for a gasoline powered vehicle, according to GreenCars, an EV industry source. The cost disparity would have been even more if Tesla had not lowered some prices by up to 24% last year. Price remains a barrier to wide adoption
Administration officials claim there are 3 million EV's on the roads today, but data indicates the number is closer to 2 million. In addition, there are currently 6.8 million hybrid (gas and electric) vehicles. EV's are a tiny number of the nation's 284 million vehicles. The average age of a vehicle is 12 years.
If the EPA successfully reaches its electrification sales goals, it will create a challenge for the nation's already stressed power grid. Experts believe a complete transition to electric vehicle will require as much as 1.25 trillion kilowatt-hours of electricity each year. It means increasing grid capacity by 30%.
Not to worry claim the green car crowd. The government will issue rules on what day and at what time you can charge your shiny EV. This will ease the strain on the grid while ending the pretense of freedom of choice for consumers. This should concern even New Green Deal activists.
The Biden electric revolution is a gift to China. The Communist nation has cornered the market on most of the rare minerals required to make electric car batteries. The key minerals include copper, graphite, nickel, cobalt, manganese and lithium. China has built a global dynasty of battery metals.
The World Bank estimates supplies of these key metals would need to increase by 500% by 2050 to meet the global electric vehicle forecasts. That works out to 3 billion tons of these rare metals. Mining those metals creates an environmental nightmare that Biden's troops never talk about.
China already accounts for nearly 75% of global EV battery production. Tesla will manufacture 40% to 50% of its cars in China this year, according industry sources. Ford announced earlier this year that it would collaborate with a Chinese supplier on building a $4.5 billion electric battery plan in Michigan.
It is beyond ironic that China, the world's top emitter of greenhouse gases, will reap the most benefit from the administration's top-down management of the electric vehicle industry. Let that sink in.
As if those obstacles are not steep enough, consider millions of electric vehicles traveling America with a sparse network of charging stations to provide juice for the batteries. Tesla years ago began building its own charging network with its own money. How quaint--a private sector initiative.
Now the federal government has appropriated $7.5 billion of your tax dollars to build out a national network of EV chargers. Democrats are already clamoring for $85 billion more. It will take more than several decades to match the ubiquity of gasoline stations on highways and roads in America.
The media echo chamber, led by The New York Times and The Washington Post, are in full throated support mode. The media giants are publishing articles assuring skeptics that solutions will be found to solve the electric grid, rare mineral scarcity, charging stations and dependence on China.
Never bet against American ingenuity to create technological solutions to solve conundrums. But it will require years of research and development. There are no magic bullets or shortcuts. Mandating electric cars before these issues can be solved is a recipe for an epic boondoggle.
But if you say it out loud the New Green Deal activists will accuse you of denying climate science and wanting to end life as we know it on planet Earth. Government has never been better than private industry at producing anything. Which is why the Biden prescription needs a dose of reality.
