Four years ago, GM set a daring goal: by 2035 the automaker was planning to go fully electric.
The company says it is still focused on that goal. But at the same time it lobbyed the Senate to end the prohibition of California on the sale of new gas cars – which also had to come into effect in 2035. In theory, California’s policy should have supported the transition from GM.
GM even recruited employees at the lobby effort. “We need your help!” The company wrote to the staff in an e -mail, such as reported by the Wall Street Journal. “Emission standards that are not tailored to market reality pose a serious threat to our company by undermining the choice of consumers and the affordability of the vehicle.”
The lobby worked. Yesterday, the Senate voted to withdraw an exemption from an environmental protection agency so that California could determine clean air rules that are stricter than national standards. (Congress demonstrably did not have the legal right to withdraw the distance from distance; more about that later.)
In a statement, the company said: “GM appreciates the action of the congress to set up emission standards with the current market realities. We have long argued for one national standard with which we can remain competitive, investing in American innovation and offering customer choice in the widest arrangement of gas-driven and electric vehicles.”
[Photo: GM]
GM CEO Mary Barra has said that the company believes in a fully electric future. The company, which started to invest seriously in battery design in 2018, spent $ 11 billion on EV infrastructure between 2020 and 2024. It has a huge battery factory, co-ownership of LG energy, near Nashville, and another in Ohio, making thousands of battery cells per minute. It is racing to lower the costs of batteries, the biggest factor in the total costs of EVs.
In the first quarter of this year, GM sold 31,887 EVs in the US, an increase of 94% compared to its sale of electric vehicles in the same period last year. It is now the second largest seller of EVs in the US and quickly wins on Tesla. The company is planning almost to double the number of EVs that it makes this year compared to the latter. It has 11 models on the market, including the Chevy Equinox EV, currently the most affordable EV in the country. The popular Chevy Bolt, another affordable EV, will Come back later this year.
But the company states that the clean car rule of California is moving faster than the market demand. The rule sets goals that car manufacturers have to touch every year. For model year 2026 cars, 35% of the car sales of a manufacturer in the state are zero emission, or the manufacturer must pay a fine. The target jumps up to 43% in 2027, 51% in 2028, and will continue until new cars are 100% zero emissions in 2035. Last year, in California, in California, About 25% From new cars registered in the state, were electric. This year, because many buyers are away from Tesla, the percentage of EV sales are could fall. GM refused to comment on whether it expects to achieve the goal of 35% for model Year 2026 cars in the state.
[Photo: GM]
Other states have followed the regulations of California, with the same annual goals: Massachusetts, New York, Oregon, Vermont and Washington. Those states now have even lower percentages of EV sales. Car companies say that it would be unrealistic for them to immediately reach the goals for model year 2026 that those states need.
Critics claim that if the demand is lower than expected, car manufacturers themselves bear some responsibility. “That is just like the boy who says:” Look, I didn’t study for the test, and it is unfair that you give me a bad figure, “says Becker, director of the Safe Climate Transport Campaign in the non -profit center for organic diversity, and notes that GM has the best engineers in the United States in the United States. Spends $ 14 billion a year on advertising and other marketing.
EVs face other major challenges. The house has just voted to abolish the $ 7,500 tax credits to buy or lease new EVs (companies that have not yet sold 200,000 EVs will be able to continue to qualify for the credits until the end of 2026; GM has already assumed that limit). The house account also terminates a tax credit of $ 4,000 for used cars that were introduced in the Inflation Reduction Act and a different tax credit for home loaders. Because EVs have not completely reached the price parity with gas cars, the tax credits are crucial.
Car companies are also confronted with steep costs of rates. A GM spokesperson said in the background that the rules of California could cost the company billions at a time when the profit is already pressed by rates – and that is money that the company must continue to invest in EV development to lower the costs. GM still loses money with making EVs, although the costs fall as production scales up and the technology continues.
The Senate voice about California is not final. The Senate Parliamentarian ruled that the congress did not have the authority to destroy the exemption with which California can make its own clean air rules. Reviews are not included in the Congressional Review Act, the law that the Senate used to withdraw the exemption. (The CRA allows the congress to cancel recent laws with a simple majority voice; The exemption was also granted in 2022 and would not be demonstrably considered to be recently considered.)
‘The congress may not change [laws] On the way by saying: ‘Oh, well, we really meant it is this, “says Becker. “It is a Pandoras Box that they open. If the CRA is not limited to rules, then you have opened the door about what can be undone by the congress action – mergers of the corporate allowed by the SEC [Securities and Exchange Commission]Cost-of-Living adjustments by different agencies, offshore drilling permits that know how this will ultimately be used. And the Republicans will not always be in charge. ‘
California can possibly sue. “That will lead to uncertainty for industry,” says Becker. “They keep saying that they want certainty. And they come from evaluating that the congress uses an illegal mechanism to undo protection for people with lungs.”
In the meantime, EVs are growing outside the United States faster. Worldwide, More than one in four cars This year an EV will probably be sold. In China, more than half of the new car purchases were fully electric last year. In Norway, 97% of all cars sold last month was electric. While the federal support in the US is reversing, American car manufacturers will lag behind.
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