Biden wants to give electric cars a huge boost. Will people buy them?
About 2 percent of new cars on US roads right now run on electricity. The auto industry expects that by 2030, half of new car sales will be electric. And President Joe Biden is stepping on the gas pedal to make that happen.
Among the many provisions of the White House’s $2 trillion infrastructure and jobs plan released last week is $174 billion to support electric vehicles, the single largest item in the proposal’s transportation section.
That money will help pay for 500,000 electric vehicle chargers over the next decade, an idea from Senate Majority Leader Chuck Schumer. It also covers modifying factories to build electric vehicles (EVs), grants and tax incentives to encourage buyers, and shoring up a domestic supply chain to make electric cars and trucks.
Electrifying transportation is a major component of how the Biden administration plans to tackle climate change. The transportation sector is the largest source of greenhouse gases in the US. Cars and light trucks account for 60 percent of these emissions. So EVs would be a huge step toward meeting Biden’s goal of decarbonizing the US economy by 2050, alongside a decarbonization of the power sector.
These ideas are an abrupt turn from Biden’s predecessor. The Trump administration moved to weaken federal fuel economy rules for cars and light trucks, going as far as to sue the state of California for reaching a voluntary agreement with several automakers to impose its own stricter standards.
Getting a significant share of the US’s 270 million vehicles electrified by 2030 would be a massive leap. And US automakers, despite their insistence on an electric future, have so far been lackadaisical in their electric offerings, while continuing to crank out fuel-thirsty SUVs, crossovers, and even larger pickup trucks.
The effort to switch to EVs is a microcosm of the broader effort to fight climate change — any shift to a carbon-neutral economy requires everyone to act, but the federal government only has so many levers. Short of direct mandates, the government will need to use a system of nudges and prods to get everyone from companies to car buyers to homeowners to make the requisite investments in clean energy.
But if the US can pull off electrification of its greatest contributor to climate change, it bodes well for decarbonizing the rest of the economy.
Biden’s plan requires the government to lead by example — with big fleets of electric vehicles
One of the big challenges with switching over to EVs is that a lot of people have to choose to buy them. It’s tricky to convince finicky consumers to buy something without a mandate, but Biden does have the massive purchasing power of the government at his disposal.
He has already pledged to replace the federal government’s 650,000 vehicle motor pool with electrics. “The federal government also owns an enormous fleet of vehicles, which we’re going to replace with clean electric vehicles made right here in America made by American workers,” Biden said in a January press conference. Currently, the US government’s fleet has just over 3,000 electric vehicles.
The new infrastructure proposal also calls for electrifying 20 percent of the nearly 500,000 US school buses with a grant program administered through the Environmental Protection Agency.
Some Democratic lawmakers are also pushing to halt a $6 billion contract to build the next generation of US Postal Service delivery vehicles. The contract, awarded in February, calls for up to 165,000 vehicles from a mix of gasoline and electric variants. Democrats want those vehicles to be entirely electric.
Delivery vehicle fleets are a ripe target for electrification because purchasers like USPS can take advantage of bulk discounts. Mail trucks also return to a central location at the end of their rounds, meaning less charging infrastructure is needed.
“Squandering this once-in-a-generation opportunity by spending billions of dollars on vehicles that will be custom built for obsolescence — indeed, by the end of their operating lives they will be the last internal combustion fleet vehicles on the road — and defying President Biden’s Executive Order is utterly unacceptable,” 13 House Democrats wrote in a letter to the Postal Service’s Board of Governors last month.
Private delivery fleets are already investing in electric delivery, with FedEx vowing to run a 100 percent electric fleet by 2040.
While big purchases of delivery trucks and buses aren’t likely to sway car buyers, ordinary drivers considering EVs could still benefit from the supply chain boost for components like batteries and the buildup of charging infrastructure.
Another upside of electrifying trucks, buses, and delivery vehicles is the opportunity to get many of them off of diesel fuel. Diesel pollution accounts for 180,000 deaths around the world each year. So the transition to cleaner fleets doesn’t just have a benefit to the climate over the long term but yields an immediate health benefit.
The government and the auto industry still need to do more to meet their electric goals
Bulk purchases and a massive expansion of EV charging are important steps, but they aren’t enough on their own to convince wary car buyers to give up the rumble of a gasoline engine.
A YouGov poll from October 2020 found that half of Americans would support a mandate to end fossil fuel-powered vehicle sales, similar to California’s plan to limit auto sales to zero-emissions vehicles by 2035.
However, the main deterrent to buying EVs for most Americans isn’t the number of charging stations. According to the poll, the highest-ranking concern was charging time, followed by a higher upfront cost for EVs, the hassle of charging, and the cost of charging at home. Subsidies and tax credits can offset some of the cost concerns, but the other hurdles may require technological advances that aren’t here yet.
Carmakers, for their part, have put out plans for more electric vehicles over the coming decade. Volkswagen recently joked that it was changing its name to Voltswagen. Even Ford is working on an electric version of its F-150 pickup truck, one of the best-selling vehicles in the US.
But car companies will also have to put more marketing muscle behind their electric vehicles. Environmental groups have observed that automakers spend much less when advertising their cleaner vehicles than their larger, more expensive trucks and SUVs. These larger vehicles tend to have bigger profit margins than EVs.
Switching over to EVs would also require an incentive to take some of the oldest, dirtiest cars off the road at a faster rate, something that isn’t addressed in the current plan. During the Covid-19 pandemic, new car sales dropped, and used car sales shot up. Schumer has called for a “cash for clunkers” program, based on a similar idea from 2009, where people could trade in their gas guzzlers for discounts on EVs.
And while running an electric car is as clean as the electricity that charges it up, making EVs to begin with can have a higher carbon footprint, so better sourcing of critical components (like lithium for batteries) and more efficient manufacturing are also needed.
Automakers will need to prepare for even bigger changes on the horizon: How people drive today may not be how they drive tomorrow. With the advent of ride-hail apps, the push for greater urban density, more options for short trips like electric scooters, and the potential for autonomous vehicles, there is less need for everyone to have their own car. So while car companies may grumble about switching gears to cleaner cars, they still have to keep their eyes on the road ahead.