Virginia dumps EV mandate

From the Daily Caller News Foundation

Virginia is ditching rules that would have mandated 100% of new car sales to be electric vehicles (EVs) by 2035.

Under former Democratic Virginia Gov. Ralph Northam, the state enacted a law in 2021 that hitched it to California’s stringent vehicle emissions standards, the latest version of which will require the phase-out of internal combustion engine models by 2035. Current Republican Gov. Glenn Youngkin and his administration announced Wednesday that Virginia will not be following California’s new regulations once the current set expires at the end of the year.

“Once again, Virginia is declaring independence – this time from a misguided electric vehicle mandate imposed by unelected leaders nearly 3,000 miles away from the Commonwealth,” Youngkin said in a statement. “The idea that government should tell people what kind of car they can or can’t purchase is fundamentally wrong. Virginians deserve the freedom to choose which vehicles best fit the needs of their families and businesses. The law is clear, and I am proud to announce Virginians will no longer be forced to live under this out-of-touch policy.”

Once again, Virginia is declaring independence – this time from a misguided electric vehicle mandate imposed by unelected leaders nearly 3,000 miles away from the Commonwealth.

— Governor Glenn Youngkin (@GovernorVA) June 5, 2024

Youngkin has opposed the policy because “California’s requirements for their citizens should not be a one size fits all solution for Virginia,” the governor’s staff previously told to the Daily Caller News Foundation. Previous efforts by state Republicans to repeal the law linking Virginia to California’s standards failed, and legislative avenues to get rid of the rules closed when Democrats cemented control of the state legislature in last fall’s elections.

The governor’s office cited a legal opinion by Republican Virginia Attorney General Jason Miyares to substantiate its decision. Miyares’ opinion asserted that the state is not obligated to abide by the California Air Resource Board’s (CARB) Advanced Clean Cars II rules, which would have taken effect at the beginning of 2025 and required EVs to make up 35% of all new car sales starting in model year 2026 on the way to 100% by 2035.

“Given that EVs only amounted to 9% of vehicles sold in Virginia in 2023, application of the misguided mandates could have resulted in hundreds of millions of dollars in penalties,” Youngkin’s office said in the official announcement. “Virginia auto consumers and dealers could be forced to bear these costs. Not only would this leave auto dealers with less money to pay staff, offer raises, and grow their businesses, it could force many small auto dealers to permanently close their doors.”

Numerous Democrat-leaning or blue states have adopted CARB’s auto emissions standards, which are more stringent than federal standards, according to The Wall Street Journal.

Neither CARB nor the office of Democratic California Gov. Gavin Newsom responded immediately to requests for comment.

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Ottawa’s tariffs undercut Ottawa’s EV mandate

Published on September 4, 2024

Todayville

From the Fraser Institute

By Kenneth P. Green

Asian countries such as China and Japan were not particular threats to prior automotive markets because North America’s massive and diverse internal combustion vehicle markets were capable of relatively lower-cost production of superior quality vehicles. That’s not shaping up to be the case for EVs, which are vastly more expensive coming off North American assembly lines than in China and other Asian countries.

Seemingly every week, Canada’s electric vehicle (EV) transition policy framework grows more incoherent. The goal of Canada’s EV policy is to ensure all new light-duty vehicle sales in Canada are zero-emission vehicles (ZEVs), with a strong emphasis on battery-electric vehicles, by 2035.

The latest incoherence is Prime Minister Trudeau’s announcement of 100 per cent tariffs on Chinese EV imports and 25 per cent tariffs on Chinese steel and aluminum imports (the Canada needs to build EVs). This will directly undercut the government’s EV transition targets by denying Canadians access to affordable electric cars.

The stated rationale for the tariffs is, according to Finance Minister Chrystia Freeland, that the “Chinese are trying to corner the North American EV market by dumping subsidized vehicles into it” and that “China has an intentional, state-directed policy of overcapacity and oversupply designed to cripple our own industry” so “we simply will not allow that to happen to our EV sector.” And arguably, some of that is probably reasonable.

Tariffs are generally understood as protectionist mechanisms, designed to shield domestic industries from lower-cost foreign competition by making imported goods more expensive. Additionally, they can serve as punitive measures to penalize countries for hostile economic or political actions. By limiting access to one’s markets, tariffs can reduce the profits of the targeted country, thereby pressuring it to alter behaviours or policies. When imposed against countries intentionally sabotaging markets, tariffs may be considered a legitimate response.

But tariffs on China will also hurt Canadians by keeping lower-cost goods out of our market, leaving them with only higher-priced goods and services provided by protected domestic industries that need not fear price competition and thus feel little pressure to lower the prices for their goods and services.

And this is part of the incoherence of the new Trudeau tariff policy. The Trudeau EV mandates are set to create, in essence, a monopoly on the types of automotive technologies (again, EVs) allowed to be used in Canada, which other countries can manufacture more cheaply than domestic manufacturers. Asian countries such as China and Japan were not particular threats to prior automotive markets because North America’s massive and diverse internal combustion vehicle markets were capable of relatively lower-cost production of superior quality vehicles. That’s not shaping up to be the case for EVs, which are vastly more expensive coming off North American assembly lines than in China and other Asian countries.

By driving up the costs of buying EVs in Canada, the Trudeau government will directly undercut its EVs-by-2035 mandate. If people can’t afford EVs, as most currently cannot, the EV mandate targets are doomed. People will simply hold their old internal-combustion vehicles for longer. This trend is already observable in the United States where new vehicles have become more expensive. Americans are holding on to their vehicles longer than ever, with the average vehicle age reaching 13.6 years.

The Trudeau government’s highest priority has been the war on climate change, which various government leaders in Canada and around the world have proclaimed the greatest threat to people and the planet in human history. But if the government is sincere about this, then the priority should be to maximize Canadians’ access to cheaper EVs, and the prime minister should be largely indifferent to where Canadians choose to source those EVs. Indeed, he should urgently want low-cost EVs available to Canadians for there to be any hope of achieving his all-EV by 2035 goal.

Author:

Kenneth P. Green

Senior Fellow, Fraser Institute

Automotive

Trudeau and Ford at it again with more taxpayers dollars for EVs

Published on August 21, 2024

Todayville

From Canadians For Affordable Energy

Dan McTeague

Written By Dan McTeague

More good money is being thrown after bad, but that seems to be the theme of Trudeau’s government.

On Monday Goodyear Tire announced a $575 million expansion of their Eastern Ontario manufacturing plant to produce electric vehicles, and to make their plant more energy efficient.

And Doug Ford and Justin Trudeau were there for the photo opportunity. Why? Because — shocker — this move comes with serious money from taxpayers in Ontario and throughout Canada. Goodyear is set to receive up to $44.3 million from the federal government through the Strategic Innovation Fund and $20 million from Ontario through the provincial Invest Ontario.

In case you’ve lost track of the money — your money — which has been thrown down this blackhole to date, here’s only some of the close to $46 billion that has been committed:

Northvolt, electric vehicle battery manufacturing facility, up to $1.34 billion
Stellantis—LGES (NextStar), EV battery manufacturing facility — $5 billion
Volkswagen (PowerCo), Federal ($700 million) and Ontario governments ($500 million)
Ford EcoPro, $322 million
Stellantis, Federal ($529 million) and Ontario government ($513 million)
Umicore, Federal ($551.3 million) and Ontario government ($424.6 million)
Ford Motor Company of Canada, $295 million from both the Federal and Ontario governments
GM Ingersoll, $259 million from both the Federal and Ontario governments

More taxpayer dollars for cars that no one wants to buy, and are only affordable with heavy government subsidies.

In fact, last month Ford Canada announced that they would be abandoning their plans to retool their plant in Oakville, ON to focus on EV production. Instead, the plant will begin to produce their popular F-Series gasoline-powered heavy duty pickup truck. Ford plants in Ohio and Kentucky are at full capacity and can’t keep up with the demand for the F-Series, so they are shifting some of the load to Oakville. (Trudeau might learn a lesson here about supply and demand, which is what makes a healthy economy work.)

Plant workers were no doubt relieved to hear this, as Ford had already delayed the date when the plant would begin producing EVs from 2025 to 2027, due no doubt to their multi-billion dollar annual losses on EVs. (They lost $4.7 billion on EVs in 2023 and they’re projected to lose nearly $5.5 billion this year.) Many workers had already been laid off, and many more layoffs were expected. But now they’ll be hard at work producing a reliable Internal Combustion Engine (ICE) pickup.

This should come as no surprise. We need only look around the world for examples of dwindling EV sales. In Germany, EV sales fell by 37%. This slump is directly related to the premature ending of the purchase subsidies program. Budget issues forced Germany to end the program a year sooner than anticipated.

In fact, whenever a country reports an increase in EV sales, be sure to look at the subsidies being offered. “In France, a social leasing scheme which helps to provide cheap EVs to low-income households helped see BEV sales increase by 14.9 per cent in the first half of 2024”. And in Italy EV incentives helped push EV sales “up by 7 per cent across the first six months of the year.”

The lavish subsidy programs for EVs have created a false economy whereby they are only attractive and affordable with taxpayer handouts. Canada should expect the same slump in sales when our own subsidy programs come to an end.

In fact, the only nation which shows no sign of slowing down on electric vehicles is China, where they’re pumping them out at breakneck speed. This is, of course, so that they can take advantage of the EV mandates which Canada and other nations have enacted. China’s EV manufacturers are able to undercut Western producers since they control the lion’s share of Lithium battery production.

Their government also heavily subsidizes the industry. But chances are, once they control most of the EV market share, bankrupting smaller producers, they’ll jack up the price. And because of the mandates, drivers will either have to pay what they’re asking, or else invest in a horse and buggy.

This has led to calls for the Trudeau government to impose punitive tariffs on Chinese EVs, to prevent them from inundating the Canadian market to the detriment of Canada’s economy and Canadian workers. Trudeau and co have dragged their feet, likely because they don’t want to offend Chairman Xi.

We certainly should impose those tariffs. But what would be even better for regular, everyday Canadian taxpayers — not that that ever seems to be top-of-mind for Trudeau or Doug Ford — would be to scrap the EV mandates altogether. Forcing Canadians to buy EVs by 2035 is a terrible policy that will make us poorer as individuals and poorer as a nation. And it will ultimately fail.

Better to admit that now, while we still have some money we haven’t paid out by the truckload to green corporate grifters.

Dan McTeague is President of Canadians for Affordable Energy.