California’s Impending Ban on New Sales of Gas-Powered Vehicles

On September 23, 2020, California Governor Gavin Newsom announced an executive order effectively banning the sale of new fossil-fuel powered passenger vehicles in 2035 and medium and heavy-duty trucks in 2045. Gas-powered vehicles sold before these years can still operate and be sold in the used-car market. The order would make California the first state in the nation to mandate the sale of zero-emission automobiles and is set to accelerate global car manufacturers’ burgeoning transition away from combustion engines should it survive court challenges by fossil fuel-industry aligned groups and the Trump administration.

Climate change played a key role in Newsom’s decision. Severe wildfires generated partially by weeks of record-breaking heat have devastated California, forcing mass evacuations of major cities, rolling power shutoffs, and dangerous air quality throughout the state. Research indicates that taking all gas-powered cars off the road in California would reduce carbon emissions by nearly 35%. In addition, California has seen usage of passenger vehicles plummet in recent months due to the COVID-19 crisis. With more people working from home than any other time in living memory, demand for automobiles has plummeted—marking a key opportunity for California to shift away permanently from fossil fuels.

Over the next decade, California will have to continue to develop the infrastructure necessary to handle this important transition. State energy companies, working in concert with Sacramento, have invested millions into ever-growing electric vehicle charging networks, and created tax rebates designed to incentivize electric vehicle purchases. The state’s major regions have also taken initiatives to create more robust and user-friendly public transportation systems that can potentially serve as more convenient alternatives to cars. This includes new subway lines in Los Angeles and San Jose, Bus Rapid Transit expansions in San Francisco, and the long-awaited high speed rail system connecting Northern and Southern California. City planning in the state is also shifting to favor dense homes in urban areas better connected by public transit services over traditional car-centric suburbs.

Newsom’s move will likely accelerate the ongoing transition of automobile manufacturers across the world towards electric vehicles. Some manufacturers, such as Ford, have openly embraced California’s new zero-emission vehicle mandate. GM, which scrapped nearly the entirety of its lineup of gasoline-powered sedans, is gearing up to introduce 12 new electric pickup trucks and utility vehicles. Japanese manufacturer Toyota, which has long pioneered hybrid powertrains, projects it will sell 5.5 million electric cars by 2025—which would comprise nearly half of its global sales figures.

While California’s new executive order will hasten improvements in electric vehicle infrastructure and technology, it is also likely that the mandate will be met with resistance from the Trump administration, whose EPA recently blocked California from enforcing its own emissions requirements, which are more stringent than the federal standard. Ultimately, the fate of the executive order may rest with the upcoming general election. While a second term would embolden President Trump to continue to weaken the power of states like California to set separate emissions standards, a prospective Biden administration—with its own goals of making the country carbon-neutral by 2050—would likely give California the green light to continue on its aggressive push for zero-emission automobiles.

Only time will tell, but California’s action will likely reverberate across the global car market for years to come.