THE STORIES BEHIND THE HEADLINES

Abu Dhabi

London

New York

Tuesday 20th March 2018

GM’s Zero-Emissions Proposal: a Boost to Trucks and SUVs, Not EVs

Science & Technology

Benjamin Schmidt - 7Dnews London

Tue, 30 Oct 2018 11:51 GMT

Despite upbeat headlines about General Motors’ recently announced zero-emissions proposal to the US federal government, many reports have ignored the fact that the standards the company are proposing will not boost electric vehicle production and will also make it easier for US auto companies to keep making large numbers of inefficient trucks and SUVs.

America’s largest automaker said it wanted a new nation-wide standard that would require a percentage of auto companies’ sales to be zero-emissions vehicles, beginning at 7% of all vehicles by 2021 and rising to 25% by 2030. The new rules would be an alternative to both the Obama-era emission standards and recent rollbacks of those standards being pushed by the Trump administration.

"A national zero emissions programme will drive the scale and infrastructure investments needed to allow the US to lead the way to a zero emissions future," said Mark Reuss, GM's executive vice-president of product development, according to AP.

Meanwhile, the proposal being promoted by the Trump administration aims to freeze Obama-era fuel economy and emissions standards at 2020 levels instead of gradually making them tougher. California Governor Jerry Brown, whose state is one of many that have filed objections to the Trump plan, made a statement on Friday October 26th condemning the administration’s proposal. "Foolishly, [the Trump administration proposal] mandates gas guzzlers instead of clean and zero-emission vehicles," Brown told reporters. 

GM also does not support the freeze. Instead, it wants a zero-emissions rule that would allow it to continue producing SUVs and trucks that have been highly popular in the cheap-petrol era of the past four years, while simultaneously encouraging production of fully electric vehicles like the Chevrolet Bolt.

GM, which also produces the plug-in hybrid Chevrolet Volt, has invested millions to develop battery technology and will therefore benefit from additional electric vehicle sales nationwide. The company has also promised to introduce 20 new all-electric vehicles globally by 2023.

Its proposed requirement is based on current standards in California and nine other states that dictate that just over 1% of new automobiles must be fully electric. GM’s proposal would create a simpler and less stringent requirement than the one in California and would cover the entire country. "We want really one national set of standards," Reuss said, before adding that following state-by-state rules added unnecessary engineering and other costs.

In comments to the AP, Daniel Becker of the Safe Climate Campaign, an environmental advocacy group, said that GM’s proposal reflects the fact that US auto companies are seeing rising demand for both their most efficient and most inefficient vehicles. “The auto companies want to be able to make a small number of electric vehicles and a large number of gas-guzzling SUVs and other trucks instead of complying with the existing mileage and emissions rules."

Fred Lambert, the main writer at Electrek, an electric vehicle news site, is highly critical of GM’s proposed rules. He believes they will be ineffective in promoting electric vehicle sales while making it likely that the US auto market will fall behind countries like China that have implemented stricter rules.

“This proposal is a weak mandate,” Lambert wrote in a post on October 26th. “It’s not leadership, it’s greenwashing.” He notes that China has mandated that 12% of its cars must be electric by 2020, putting it three to four years ahead of the US. “GM is basically suggesting that the US doesn’t even try to catch up with China’s lead in electric vehicle adoption.”

At the same time, Lambert predicts that Tesla alone will be selling 7 million long-range electric vehicles a year by 2030 “without any mandates from the government.” To be sure, Lambert’s Tesla prediction is unlikely to be fulfilled. GM, which holds the largest share of the US auto market, sells just 3 million cars each year. At the same time, it is likely that electric vehicle production will expand quickly across the industry during the next few years.

In addition to GM’s plans for a 20 vehicle electric range by 2023, Ford has announced that its entire lineup of vehicles will be at least partially electric by 2022, including 16 fully electric vehicles. Similarly, Toyota said it would release 10 new battery-electric vehicles by the early 2020s and that its entire line-up would have electric options by 2025, and Volkswagen has said all its vehicles will have electric options by 2030. With all these plans in motion, a requirement for seven million EVs by 2030 seems like a low regulatory hurdle.

Meanwhile, current sales of electric vehicles are growing faster than expected. Tesla has just had the best quarter in its history—and its first profitable one since 2016. According to the company’s third quarter update, Tesla earned $311 million in profit from $6.8 billion in total revenues after nearly doubling production of its Model 3 from the second quarter of this year. The US company delivered 56,065 of its cheaper Tesla 3 sedans in the third quarter.

On balance, GM’s proposal to the US federal government is neither ambitious nor especially friendly to the environment. But it is still promising, since it proposes a more emissions-conscious standard than the latest Trump administration plan. When a country’s largest automobile manufacturer wants stricter environmental standards than the government, there is no mistaking who is out of step.

US & Canada