Today U.S. President Joseph Biden will announce as a part of his Build Back Better Agenda and the slow-moving U.S. Senate Bipartisan Infrastructure Deal investment in infrastructure, manufacturing, and incentives aimed at driving the country to a cleaner electric vehicle future. The President will sign an Executive Order that sets an ambitious new target to make about half of all new vehicles sold in 2030 zero-emissions vehicles, including battery-electric, plug-in hybrid electric, or fuel-cell electric vehicles. It also kicks off the development of long-term fuel-efficiency and emissions standards “to save consumers money, cut pollution, boost public health, advance environmental justice, and tackle the climate crisis.”
In addition, the U.S. Environmental Protection Agency (EPA) and the Department of Transportation (DOT) will announce how they are addressing the previous administration’s rollbacks of near-term fuel efficiency and emissions standards. Through these coordinated notices of proposed rulemaking, the two agencies are advancing what they say are smart fuel efficiency and emissions standards that would deliver around $140 billion in net benefits over the life of the program, save about 200 billion gallons of gasoline, and reduce around two billion metric tons of carbon pollution. For the average consumer, this means net benefits of up to $900 over the life of the vehicle in fuel savings.
The new actions and others of the Build Back Better Agenda are aimed at strengthening U.S. leadership in clean cars and trucks by accelerating innovation and manufacturing in the auto sector, bolstering the auto sector domestic supply chain, and growing auto jobs with good pay and benefits. The White House wants to jumpstart the U.S. market and aid the manufacturing of electric vehicles and their batteries.
The President’s plan looks at installing the “first-ever” national network of electric vehicle charging stations, delivering point-of-sale consumer incentives to spur U.S. manufacturing and union jobs, financing the retooling and expansion of the full domestic manufacturing supply chain, and innovating the next generation of clean technologies to maintain the country’s competitive edge.
The Executive Order sets a target of electric vehicles representing half of the new vehicles sold in 2030. This builds on announcements today from automakers, representing nearly the entire U.S. auto market who have positioned around the goal of reaching 40% to 50% electric vehicle sales share in 2030. That timing target is calibrated to provide time for existing manufacturing facilities to upgrade without stranding assets and “lean into” a path that expands domestic U.S. manufacturing with union workers.
The EPA and DOT’s National Highway Traffic Safety Administration (NHTSA) will announce near-term fuel efficiency and emissions standards building on the “California Framework Agreement” between the State of California and five automakers: Ford, Honda, Volkswagen Group, BMW, and Volvo. The Executive Order lays out a schedule for the development of fuel efficiency and multi-pollutant emissions standards through at least model year 2030 for light-duty vehicles and for medium- and heavy-duty vehicles starting as early as model year 2027.
“We remain committed to leading the industry in fighting against climate change,” read a joint statement of California framework companies BMW, Ford, Honda, Volkswagen, and Volvo. “That’s why we support the Administration’s goal of reaching an electric vehicle future and applaud President Biden’s leadership on reducing emissions and investing in critical infrastructure to achieve these reductions. While the California framework companies are driving towards 40-50% of our sales being EVs in the next nine years, bold action from our partners in the federal government is crucial to building consumer demand for electric vehicles and put us on track to achieve the global commitments of the Paris Climate Agreement.”
The three biggest U.S. automakers also expressed their support for the effort in a joint statement.
“Today, Ford, GM, and Stellantis announce their shared aspiration to achieve sales of 40-50% of annual U.S. volumes of electric vehicles (battery electric, fuel cell, and plug-in hybrid vehicles) by 2030 in order to move the nation closer to a zero-emissions future consistent with Paris climate goals. Our recent product, technology, and investment announcements highlight our collective commitment to be leaders in the U.S. transition to electric vehicles. This represents a dramatic shift from the U.S. market today that can be achieved only with the timely deployment of the full suite of electrification policies committed to by the Administration in the Build Back Better Plan, including purchase incentives, a comprehensive charging network of sufficient density to support the millions of vehicles these targets represent, investments in R&D, and incentives to expand the electric vehicle manufacturing and supply chains in the U.S.”
The Alliance for Automotive Innovation President and CEO John Bozzella added his organization’s support for the new effort, emphasizing commitments already made by the entire industry.
“Collectively, the auto industry has committed to investing more than $330 billion to bring exciting new electric vehicles (EVs) to market, including plug-in hybrid, battery, and fuel cell EVs,” he said. “With the right complementary policies in place, the auto industry is poised to accept the challenge of driving EV purchases to between 40% and 50% of new vehicle sales by the end of the decade. Federal and state governments—and all stakeholders—will need to provide significant support for consumers, infrastructure, and innovation.”
The United Auto Workers union’s President Ray Curry also expressed his support of the effort.
“We are at a critical time for the auto industry as countries compete to build the vehicles of the future. We are falling behind China and Europe as manufacturers pour billions into growing their markets and expanding their manufacturing. We need to make investments here in the U.S. Fortunately, President Biden recognizes the importance of this moment, and his Build Back Better Plan makes the bold investments in manufacturing, consumer incentives, and infrastructure needed to ensure vehicles of the future are made in our country.”
The White House says that today’s announcements will put the U.S. on track to reduce greenhouse gas emissions from new passenger vehicle sales by more than 60% in 2030 compared to vehicles sold last year. They will also help to achieve the President’s goal of 50-52% net economy-wide greenhouse gas emission reductions below 2005 levels in 2030.
