Majority of US states sue Biden administration over EV mandate
A coalition of 26 states has filed a lawsuit against the Biden administration over new climate mandates that will force the auto industry to produce more electric vehicles, even as demand for electric cars continues to plummet.
‘Americans still aren’t buying it’
Earlier this month, the National Highway Traffic Safety Administration (NHTSA) finalized new fuel efficiency standards. According to the new rules, carmakers will be required to maintain a fuel economy average of 50.4 miles per gallon throughout their fleets by 2031. Experts say that this impossible standard for gas-powered cars will force auto manufacturers to increase electric vehicle (EV) production.
Last week, Kentucky Attorney General Russell Coleman and West Virginia Attorney General Patrick Morrisey announced they had filed a lawsuit in the US Sixth Circuit Court of Appeals to block the climate mandate. They have now be joined by the attorneys general of Alabama, Alaska, Arkansas, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Louisiana, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Texas, Utah, Virginia, and Wyoming.
“President Biden has spent billions and mobilized the entire federal government to push EVs, and Americans still aren’t buying it. Even if they wanted an EV, fewer and fewer families could afford one because of historic inflation,” said Kentucky Attorney General Coleman in a press release. “Kentuckians want the Biden Administration to focus on the crisis at the border, violent crime and the surge of deadly drugs instead of picking its favorites in the auto industry.”
Nearly 1 in 2 EV owners considering gas vehicles
Recent surveys suggest that nearly half of EV owners in the US are experiencing buyer’s remorse. According to a McKinsey & Company poll of 30,000 participants, 46% of American EV owners are likely to buy a gas-powered vehicle for their next car purchase.
This lack of enthusiasm toward EVs has been blamed on a poor public charging infrastructure, high costs, and limited ranges.
Plummeting demand for electric cars is causing major losses for auto industry players, many of whom are backing away from ambitious EV projects. Smaller EV makers are struggling to survive.
Fisker
EV maker Fisker announced this month it is filing for Chapter 11 bankruptcy due to “market and macroeconomic headwinds.”
Hertz
In March, Hertz CEO Stephen Scherr resigned after his bet on EVs cost the car rental giant its biggest quarterly loss since 2020. Hertz had been praised by the Biden administration for its ambition to convert 25% of its fleet to EVs by the end of this year. In January, however, the company announced it would instead be selling its 20,000 EVs — including Teslas — at heavily discounted prices and replacing them with gas-powered cars.
Mercedes-Benz
Mercedes-Benz also recently had to give up its ambition to only sell electric cars by 2030. Instead, EVs are expected to make up only 50% of the German carmaker’s sales over the next decade.
Apple
In February, Apple abandoned its multi-billion dollar effort to create an electric car. Despite being a decade in the works and employing 2,000 people, Apple's Project Titan was axed due to falling consumer demand.
Aston Martin
A lack of consumer demand is also partly to blame for Aston Martin placing its battery-operated “supercar” on hold until 2026.
“Demand, certainly at an Aston Martin price point, is not what we thought it was going to be two years ago,” said Aston Martin Executive Chairman Lawrence Stroll.
Ford
In December, Ford slashed production of its flagship EV at its assembly plant in Dearborn, Michigan by half. The automaker cut the monthly production quote for the all-electric F-150 Lightning pickup truck from 3,200 units to 1,600 units per month.
