States
First Look At How Colorado Will Become A ZEV State: The Rule, The Cost, The Debate.
According to the Colorado Sun, “A controversial move to adopt California’s zero-emission vehicle mandate is now heading down a divided
road after the state’s rule-making body agreed to consider new regulations. In one lane, the Colorado Air Quality Control Commission voted unanimously on Friday to return in August to decide whether Colorado should adopt the stricter vehicle emissions. Such
a mandate would require auto manufacturers to make electric vehicles nearly 5% of their vehicles for sale in Colorado by 2023, with higher rates in following years. But another effort, led by auto manufacturers, wants this to be voluntary. Automakers suggested
they could make all of the electric vehicle models they sell in California available in Colorado — which is something local electric-vehicle shoppers have been demanding for years, leaving some wondering why automakers weren’t doing this already. Will Toor,
executive director of the state’s Energy Office, said both plans should proceed. ‘We think if it’s possible to get to an alternative passway that could get more electric vehicles on the road earlier and faster, that is well worth considering,’ Toor testified
during Friday’s hearing. ‘…In the meantime, our understanding from the industry is that we would pursue this conversation (with automakers) in parallel with the rule-making process.’” [Colorado Sun,
5/13/19
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Colo. Regulators Greenlight Zero-Emission Cars Program.
According to E&E News, “Colorado is poised to become the 11th state to adopt California’s zero-emission vehicle program. The Colorado
Air Quality Control Commission unanimously voted Friday to initiate a rulemaking to adopt the program, commonly known as ZEV. The vote abounds with significance. On a political level, it can be seen as a direct rebuke of the Trump administration, which is
proposing to roll back federal clean car standards and prevent California from promulgating the ZEV program. On a practical level, it represents one of the biggest steps an inland state has taken to combat global warming. The states that already participate
in ZEV — including Maryland, Massachusetts, New York and Oregon — are all in New England or on the West Coast. Colorado will become the first landlocked state to join the climate program. The Air Quality Control Commission’s rulemaking process is expected
to last until August. At that point, the ZEV program will take effect, requiring automakers to plan for selling a certain percentage of clean vehicles in the state from 2023 to 2026. In particular, plug-in hybrid and electric vehicles will need to account
for 9% of new car sales in Colorado by 2025. They currently account for just 2.5% of sales.” [E&E News,
5/13/19
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States Start Hitting America’s Electric Drivers With Higher Fees.
According to Bloomberg, “The rest of the world is handing out subsidies and incentives to speed up adoption of electric cars. But in
nearly half of U.S. states, driving a battery-powered car requires paying additional fees. To date, 24 states have imposed special fees on electric vehicles, according to a national association of state legislatures. The money usually comes in the form of
higher registration costs that can range up to $200 per year. More states are poised to follow. It’s a sharp reversal. When the new wave of plug-in cars hit the market in 2010, the federal government and a clutch of states adopted financial incentives to juice
sales, seeing the vehicles as a way to fight global warming. Now even some states with incentives—most notably California, home to roughly half of all electric cars in the country—are turning to fees as way to ensure that electric drivers pay their fair share
to maintain roads and bridges. States typically support that infrastructure through gasoline taxes. Recouping Lost Gas Tax Revenue ‘My feeling is that people using the system should pay for the system,’ said Iowa Rep. John Forbes, a Democrat who backed recent
fee legislation even though he and his wife drive a Chevrolet Bolt, one of about 1,000 electric cars in his state.” [Bloomberg,
5/13/19
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Illinois Legislators Consider Raising Costs To Own Electric Vehicles.
According to Heart Of Illinois ABC, “A bill making its way through Springfield could make it a lot more expensive to drive an electric
vehicle in the Land of Lincoln. A proposed amendment to House Bill 32-33 would change the mandatory registration fee for electric cars from $17.50 cents a year, to $1,000, annually. The argument is that electric vehicles don’t pay state gas tax. Proponents
say the ultimate goal in the price hike is to offset long overdue and costly road improvements across the state. If passed, Illinois’ gas tax would nearly double and driver’s would begin paying more to maintain regular vehicle registration; paying $148, rather
than $98. Chicago Tribune reports, Illinois is ranked seventh in EV sales last year, at 6,400 vehicles. The paper adds, there were about 15,000 electric vehicles registered in the state as of last month, but analysts project that number could increase dramatically
in the coming years as manufacturers ramp up production, customers warm to adoption, and more and better charging stations come online. Leading electric car manufacturer, Tesla is less than happy about the increase. Sharing that sentiment, is the electric
truck startup Rivian, which is slated to open production at its factory in downstate Normal in 2020.” [Heart Of Illinois ABC,
5/12/19
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EPA
Industry Asks EPA For Additional Flexibility Under Airbag Waste Rule.
According to Inside EPA, “Automakers and dealers are asking EPA to add more flexibility into its interim airbag disposal rule, which
conditionally exempts dealers and salvage vendors from hazardous waste requirements when removing and handling recalled and other airbags from vehicles. The rule aims to allow for the expedited removal of defective Takata airbag inflators from vehicles amid
a massive recall. But the National Automobile Dealers Association (NADA) in comments submitted earlier this year says it ‘fails to set out appropriate conditions to enable dealerships to manage those bags on-site in a manner that is protective of the environment
and of human health and safety.’ Rather, NADA says, EPA should allow dealers to manage the recalled bags by deploying them on-site, inside closed steel drums a certain distance from any person, thereby protecting human safety and health and removing any hazardous
characteristics. And in separate comments, two groups of automakers say while they support the exemption EPA provides, they ask for a number of additions, including extending regulatory easements to small quantity generators of hazardous waste, rather than
just very small quantity generators, and broadening the types of auto parts included in the exemption.” [Inside EPA,
5/10/19
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Electric Vehicles
China’s Electric Vehicle Market: A Storm Of Competition Is Coming.
According to Fair Observer, “China’s booming electric vehicle industry is headed for some tough price competition followed by a shakeout, according to experts. The competitive landscape
for China’s EV market is changing dramatically on several fronts. The phase-out of Chinese government subsidies on EVs is set to gather speed in June before they are eliminated by 2020. Meanwhile, some 500 manufacturers have registered to make EVs in the country.
Global automakers such as GM and Volkswagen are also expected to intensify their efforts in China, bringing superior technology and brand recognition. Against the backdrop of those corrections came a recent trailblazing show by Shenzhen-based BYD Company,
China’s dominant maker of EVs. BYD — which stands for ‘Build Your Dreams’ — counts Warren Buffett among its investors and posted a 632% jump in profit for this year’s first quarter to 749.73 million yuan ($111.4 million). It sold nearly 118,000 vehicles in
the quarter, up 5.2% over last year’s first quarter. In comparison, BYD’s US counterpart and EV maker Tesla posted a loss of $668 million on revenues of $4.5 billion in the latest quarter. The 63,000 cars it sold last quarter represented a 31% fall from the
previous quarter.” [Fair Observer,
5/12/19 (=)]
Op-Ed: Electric Vehicles Are Better For Wall Street Than Detroit.
According to an op-ed by Stephen Wilmot in the Wall Street Journal, “Tesla’s troubles show how hard it is to make money from electric vehicles. As the world’s top auto makers ramp
up EV sales over the coming years, their profits will come under immense strain. A wave of deal-making is one likely consequence. This month, Audi’s e-tron—an all-electric sport-utility vehicle with a starting price of $74,800, a bit cheaper than Tesla’s Model
X SUV—comes to U.S. showrooms. It will be joined early next year by an electric SUV from Mercedes-Benz and, for those on a tighter budget, an electric MINI Cooper from BMW . By the end of 2020, almost all big auto makers will have launched major EVs. The new
models won’t make much profit, at least not at first. Batteries are still more expensive than comparable combustion engines, and manufacturers will struggle to make car buyers pay the full difference given gas-guzzling alternatives. Alongside patchy recharging
networks and range anxiety, expense is typically given as a reason why EVs accounted for less than 3% of light-vehicle sales last year.” [Wall Street Journal,
5/13/19 (=)]
Auto Manufacturers
Daimler Commits To Carbon Neutrality.
According to E&E News, “Daimler AG plans to announce today that its entire passenger fleet will be carbon neutral by the end of 2039, according to an advisory shared with reporters
over the weekend. The announcement marks an unprecedented commitment to sustainability within the auto industry. It appears to be the fastest timeline for achieving carbon neutrality of any major car company. Headquartered in Germany, Daimler owns the luxury
car brand Mercedes-Benz. It previously owned Chrysler before divesting in 2007. It remains unclear whether the commitment applies solely to the manufacturing process or whether it extends to the life-cycle carbon emissions of the vehicles. Daimler representatives
declined to provide more details until after today’s announcement. While Daimler is multinational, the announcement could put pressure on several U.S.-based automakers, including Ford Motor Co. and General Motors Co. Ford pledged in 2010 to slash carbon emissions
from its manufacturing process 30% within 15 years. The company announced in 2018 that it had achieved this target eight years ahead of schedule.” [E&E News,
5/13/19 (=)]
Chad Ellwood
Research Associate
202.448.2877 ext. 119