What Do Those New Regulations Mean for The Future of Electric Vehicles?


By: Cecilia Norris

 

 

With political turmoil in Washington, and international pressure on tech development, it’s impossible not to wonder: what is the future for Electric Vehicles in America? Well, based on recent statements made by automobile OEM’s and customer demand trends, it looks like they are here to stay.

 

 

What do the EPA rollbacks mean to auto manufacturers?

 

The Environmental Protection Agency is a government agency headquartered in Washington, DC. Their mission is to “protect human health and the environment”. Congress writes the laws; the EPA enforces them by writing regulation.

 

There has been a lot of controversy over the reversal of emission standards placed on automobile manufacturers in recent months.

 

Under Obama-era policy, cars and light-duty trucks would be required to have average fuel efficiencies equivalent to 54.5 miles per gallon by model year 2025. It was announced in April of 2018 that all these standards would be rolled back, and that leaves us with a big question: what does the future look like for electric vehicles in an unregulated market?

 

Well, according to many experts: not much different. Autotrader’s senior analyst, Michelle Krebs, states this month that the administration’s action “will not suddenly prompt automakers to abandon all plans for cleaner, more fuel-efficient vehicles”. In order to remain competitive, the US has to compete with the carbon-emission regulated China and Europe. Kreb states that “these are global automakers who see the rest of the world marching in a different direction. To play in other markets, they must meet the standards of other countries, most notably China, the biggest car market in the world, which is demanding cleaner vehicles”.

 

Not only that, but the standards were drawn up in 2009 and adopted in 2012, the auto OEM’s production infrastructure and plans are now set up to support EV’s, and it would be incredibly expensive for that to be reversed. GM’s CEO announced in May that they will release at least 20 new all-electric models by 2023. Along with GM, Ford Motors recently announcing an $11 billion investment into the electric vehicle industry.

 

 

Regarding the EPA rollbacks, the Alliance of Automobile Manufacturers, which represents General Motors, Toyota, Volkswagen, and nine other automakers, sent a letter to Scott Pruitt, the head of the EPA, stating that they would continue to follow regulations closer to those of the Obama-Era, and explicitly stated that they “did not ask for [EPA rollbacks]”.

 

Demand continues to grow worldwide and Bloomberg New Energy Finance forecasts EV sales will increase to 11 million worldwide by 2025, 30 million by 2030, and 60 million by 2040, regardless of the EPA rollback.

 

 

Not only does investment spending my OEMs continue to increase in electric vehicle infrastructure, reaching $90 Billion worldwide this year, but manufacturers have directly addressed the rollback:

 

Ford: “We continue to support increasing clean car standards through 2025 and we have not asked for a rollback. We will continue to work with EPA, NHTSA and California on one national standard with additional flexibility to help us provide more affordable options for our customers.”

 

GM: “Regardless of the standards, we remain committed to improving fuel economy, reducing emissions and an all-electric future. Our priorities for modernizing the standards are the need for one national set of requirements and the need to comprehend new technology developments and increased shared and autonomous electric vehicles. We look forward to working with all parties on modernized standards that achieve better fuel economy for our customers and a better environment for everyone.”

 

Honda: “Honda supports maintaining the stringency of the standards, which will help maintain one national program, but doing so in a way that provides flexibility for manufacturers in achieving compliance and promotes advanced technologies.”

It’s clear to us, and the industry and a whole, that EVs are the obvious future. Regardless of any regulation, it’s a trend that will power on (no pun intended).

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