EPA emissions rule still goes too far, industry leaders say

NEW YORK—Although the EPA's final rule on emissions standards is less stringent than its proposed regulation, it still goes too far, industry leaders said at the Automotive Forum New York.

The rule, finalized last month, sets emissions standards for vehicles for the 2027-32 model years and forecasts that battery-electric vehicles will account for between 30 and 56 percent of light-duty sales in the U.S. in the 2030-32 model years.

The final rule includes a less aggressive pace of greenhouse gas emissions reductions in the first few model years, followed by more stringent reductions after 2030.

Compared with the proposed rule, which projected that electric vehicles would account for 67 percent of light-duty sales in the U.S. in the 2030-32 model years, the final rule adds flexibility, "especially in the early years where uncertainty is greatest," said John Bozzella, CEO of the Alliance for Automotive Innovation.

But the industry will still have to work together to achieve the targets, he said.

Mike Stanton, CEO of the National Automobile Dealers Association, voiced more skepticism, saying the rule creates an EV adoption expectation that "outpaces consumer demand."

"It's hard to see this path," he said. "We're concerned about this. It does not match what we're seeing in the showrooms."

New EV registrations increased 15 percent in January. The double-digit growth rate was significantly slower than the 52 percent growth reached in the 2023 calendar year, according to S&P Global Mobility data. EVs made up 7.8 percent of new U.S. light-vehicle registrations in January compared with 7.1 percent a year earlier, S&P Global Mobility said.

"We want to sell them," Stanton said. "We've got to look at the big picture, and I think we've got a lot of complicated problems to solve."

Toyota has filled its electrified portfolio with two dozen traditional hybrids, plug-in hybrids and only two EVs. Jack Hollis, head of sales for Toyota Motor North America, agreed that the EPA is still pushing too hard for EVs before consumers are ready. A longer runway toward EPA targets could lead to better results, he said.

Delaying the standards to the 2035-40 model years rather than 2027-32 would provide "a consistent approach where the customer can come along with you for the journey," Hollis said. "I think that would make the marketplace work and also make it more profitable for both the [original equipment manufacturers] and the dealers."

Hollis said the outcome of the presidential election in November likely will not affect Toyota's product plans, because it aims to match its lineups with consumer appetites—not regulatory statutes.

"Our plans are long term," he said.