Biden advocates for 50% electric vehicles by 2030

President Biden is expected to announce his goal of 50% electric vehicles by 2030. Rick Newman of Yahoo Finance shares the details.

Video transcript

AKIKO FUJITA: The Biden administration is setting ambitious goals to reduce the country’s carbon footprint, calling for electric vehicles to account for half of all new car sales in the United States by the end of this decade. Some climate activists, however, claiming the goal does not address the urgency of the crisis. Let’s call on Rick Newman from Yahoo Finance, who is following this story for us.

And Rick, you know, we’re talking about 50% by the end of the decade. And yet, today, electric vehicles represent only about 3% of new car sales. So how realistic is that?

RICK NEWMAN: It depends on what the government is doing, frankly. If the industry were left on its own, I don’t think it would be possible to achieve a 50% new vehicle market share by 2030. Cars are always more expensive than gasoline cars. There are still scope issues. But the Biden administration plans to do a lot to get people to buy these vehicles.

So there will be billions of dollars for new charging stations. In theory, therefore, there will be charging stations wherever you need them. It’s in the bipartisan infrastructure bill that’s now in Congress. Biden wants about $ 170 billion more. He wants new grants for anyone who buys an electric vehicle, electrifies school buses. He wants grants to build battery factories in the United States and all that sort of thing.

So, these are the reasons why the auto industry seems so very happy to accept this. Because they’re going – they think they’re going to get so much funding from the federal government to help them achieve that goal. By the way, we should point out to everyone watching, that this is a goal and not a requirement. There is no penalty for any automaker that does not achieve 50% of all new electric vehicle sales by 2030. That’s just the goal.

The story continues

AKIKO FUJITA: And Rick, you also have a few additional measures here spelled out in this plan, including limits on tailpipe emissions. I mean, explain to me how important a bump is. Because all of us – there were standards set under the Obama administration. The Trump administration canceled that. Where are things now?

RICK NEWMAN: We don’t know exactly. Because Biden has yet to say what he plans to do about it. I mean, just the very brief story here, Obama, in 2012, raised the energy efficiency standards very aggressively. This would have required about a 5% improvement in fuel economy each year. And then Trump came along, and he cut that down to about 1.5% improvement in fuel economy every year.

Now the report is that Biden is basically going to split the difference. It’s going to raise fuel economy standards above what Trump left them, which would represent about a 3.7% increase in fuel economy each year. But that they haven’t announced yet. And it takes a long time. It’s the – that changes a federal regulation, that has to go through months and months of review and things like that.

And I think one of the things we’re probably going to hear the Biden administration say, well, yeah, its fuel economy guideline isn’t as aggressive as Obama’s was in 2012. But if we have all these new EVs on the road, that’s something we didn’t really have in 2012. So that should make it easier for us to achieve the 3.7% annual increase, or anything. But it’s still on the road.

AKIKO FUJITA: OKAY. Rick Newman, staying on top of the details. Of course, you can also read his story on YahooFinance.com. Thanks a lot for that, Rick.