The Biden administration finalized the United States' toughest limits on planet-warming emissions from passenger cars and light trucks Wednesday, in a bid to accelerate the nation's transition to electric vehicles.
The Environmental Protection Agency rule -- President Biden's most far-reaching climate regulation yet -- would require automakers to increase sales of electric vehicles while lowering carbon emissions from gasoline-powered models, which account for about 20% of America's contribution to global warming.
But unlike last year's proposed rule, automakers would not need to dramatically increase electric vehicle sales until after 2030. The delayed timeline reflects an election-year concession to labor unions, a key Democratic constituency that has raised concerns about a rapid shift to electrics.
In another change from the proposal, automakers could comply by increasing sales of plug-in hybrid vehicles in addition to all-electric vehicles. Plug-in hybrids have recently proved more popular with U.S. consumers, in part because of concerns about a lack of public charging infrastructure.
The final rule will still prevent 7.9 billion tons of carbon emissions from entering the atmosphere through 2055, according to the EPA. It will also reduce fine particulate matter and nitrogen oxides, preventing up to 2,500 premature deaths from air pollution annually starting in 2055, the agency said.
"Our final rule delivers the same -- if not more -- pollution reduction than we set out at proposal," EPA Administrator Michael Regan said on a call with reporters Tuesday previewing the announcement. "These final standards will also reduce some of the most serious pollutants that impact public health."
Republican-led states and fossil fuel companies are likely to challenge the rule in court. But the Alliance for Automotive Innovation, a trade group whose members include Ford, General Motors, Stellantis and Toyota, praised the EPA's decision to delay the stricter electric vehicle requirements until after 2030.
"Moderating the pace of EV adoption in 2027, 2028, 2029 and 2030 was the right call," John Bozzella, president and chief executive officer of the alliance, said in a statement. "These adjusted EV targets -- still a stretch goal -- should give the market and supply chains a chance to catch up."
U.S. electric vehicle sales have cooled in recent months. According to estimates from Kelley Blue Book, U.S. Sales increased year-over-year by 40% in the fourth quarter of 2023, down from a 49% jump in the third quarter and a 52% spike in the second quarter.
Yet Albert Gore, the executive director of the Zero Emission Transportation Association and the son of former vice president Al Gore, said other figures paint a more encouraging picture. He noted that a record 1.2 million electric vehicles were sold in the United States last year, bringing the market share to 7.6% in 2023 compared with 5.9% in 2022.
"Whether or not we're talking about a real slowdown, the trend line for EVs has been one of phenomenal growth over the last couple of years," Gore said.
The price of electric vehicles is also falling so fast that they're now almost as cheap as gas-powered cars. The average price difference last month was $5,000, according to data from Cox Automotive.
Still, the recent sales slowdown has prompted some automakers to scale back their plans, with Ford lowering production of the much-touted F-150 Lightning electric pickup. Many automakers are now pivoting to better-selling plug-in hybrids -- a compromise between the internal combustion engines of the past and the batteries of the future.
The EPA issued an ambitious proposed rule last April that called for electrics to account for 67% of all new passenger car and light-duty truck sales by 2032.
Automakers can still comply with the final rule by making electric vehicles account for 67% of new car sales in 2032, according to the EPA. But they could also meet the requirements by making all-electric vehicles account for 56% and making plug-in hybrids represent 13%, the agency said.
Former president Donald Trump has repeatedly bashed Biden's electric vehicle goals. Trump has claimed that electric vehicles cannot travel far on a single charge, and he has pledged to scrap the EPA rule on day two of a second term. According to the U.S. Department of Energy, all-electric vehicles can typically go from 110 to 130 miles on a single charge.
On Monday, Trump sought to defend his declaration over the weekend that there would be a "bloodbath" if he lost in November, claiming he was merely describing a bloodbath for the auto sector. He wrote on his social media platform that he was "simply referring to [EV] imports" allowed by Biden, which he said "are killing the automobile industry."
The oil industry has sought to drum up opposition to the EPA rule, which could eat into demand for its petroleum products. The American Fuel & Petrochemical Manufacturers (AFPM), an industry trade group, is paying for a campaign against what it calls a de facto "gas car ban." The campaign includes ads in battleground states warning that the rule will restrict consumer choice.
"To be sure, the administration refers to these regulations as 'standards,' not 'bans' or 'mandates,'" AFPM President and CEO Chet Thompson said on a call with reporters this month. "But they do that because they know how unpopular bans are with Americans."