Biden Proposes Emission Rules to Boost Sales of Electric Cars

WASHINGTON — The Biden administration on Wednesday proposed the nation’s most ambitious climate regulations to date, two plans designed to ensure two-thirds of new passenger cars and a quarter of new heavy trucks sold in the United States are all-electric by 2032.

The new rules would require nothing short of a revolution in the U.S. auto industry, a moment in some ways as significant as the June morning in 1896 when Henry Ford took his “horseless carriage” for a test run and changed American life and industry.

If the two rules from the Environmental Protection Agency are enacted as proposed, they would put the world’s largest economy on track to slash its planet-warming emissions at the pace that scientists say is required of all nations in order to avert the most devastating impacts of climate change.

The government’s challenge to automakers is monumental. Last year, all-electric vehicles accounted for just 5.8 percent of new cars sold in the United States. All-electric trucks were even more rare, making up fewer than 2 percent of new heavy trucks sold.

Nearly all major automakers have already invested billions in producing electric vehicles at the same time as they continue to manufacture the conventional vehicles powered by gasoline, which deliver their profits. The proposed regulations would require them to invest more heavily and reorient their processes in ways that would essentially spell the end of the internal combustion engine.

The E.P.A. is “proposing the strongest-ever federal pollution technology standards for both cars and trucks,” said Michael S. Regan, the agency’s administrator, in remarks outside E.P.A. headquarters on Wednesday. “Together, today’s actions will accelerate our ongoing transition to a clean vehicle future, tackle the climate crisis head on and improve air quality in poor communities all across the country.”

“This is historic news,” he said.

The E.P.A. cannot mandate that carmakers sell a certain number of electric vehicles. But under the Clean Air Act, the agency can limit the pollution generated by the total number of cars each manufacturer sells. And the agency has set that limit so tightly that the only way manufacturers can comply is to sell a certain percentage of zero-emissions vehicles. Each model year that the rule is in effect, car companies will report to the federal government the average greenhouse emissions of all new cars sold. Companies that fall short of the standard could be penalized in different ways, including fines of billions of dollars.

The proposed regulations will surely face legal challenges from those who see them as government overreach. A group of about a dozen Republican attorneys general has filed lawsuits against the Biden administration’s climate polices, and one of its leaders, Attorney General Patrick Morrisey of West Virginia, suggested the group would fight the newest proposals.

“This administration is hell bent on destroying America’s energy security and independence by making us dependent on resources and components that can come only from abroad,” Mr. Morrisey said. “Over the coming weeks, we’ll be taking a closer look at the proposed rule, and we’ll be ready to once again lead the charge against wrongheaded energy proposals like these.”

The proposed tailpipe pollution limits for cars, first reported by The New York Times on Saturday, are designed to ensure that 67 percent of sales of new light-duty passenger vehicles, from sedans to pickup trucks, will be all-electric by 2032. Additionally, 46 percent of sales of new medium-duty trucks, such as delivery vans, will be all-electric or use some other form of zero-emissions technology by the same year, according to the plan.

The E.P.A. also proposed a companion rule governing heavy-duty vehicles, designed so that half of new buses and a quarter of new heavy trucks sold, including eighteen-wheeler big rigs, would be all-electric by 2032.

Combined, the two rules would eliminate the equivalent of carbon dioxide emissions generated over two years by all sectors of the economy in the United States, the second-biggest polluting country on the planet after China.

But some autoworkers and manufacturers fear that the transition to all-electric vehicles envisioned by the Biden administration goes too far, too fast and could result in job losses and lower profits.

While major automakers have invested heavily in electrification, they are apprehensive about customer demand for the pricier all-electric models, the supply of batteries and the speed with which a national network of charging stations can be created.

Autoworkers fear job losses, since electric vehicles require fewer than half the number of workers to assemble than cars with internal combustion engines. Labor unions are particularly concerned because many new electric vehicle plants and battery factories are being built in southern states that are politically hostile to unionized labor and where wages are relatively low.

“There is no good reason why electric vehicle manufacturing can’t be the gateway to the middle class that auto jobs have been for generations of union autoworkers,” Shawn Fain, president of the Detroit-based United Auto Workers, said in a statement. “But the early signs of this industry are worrying, prioritizing corporate greed over economic justice.”

Union workers and car manufacturers have been expressing their various fears directly to the president since 2021, when Mr. Biden announced an executive order directing government policies to ensure that 50 percent of all new passenger vehicle sales be electric by 2030.

As word spread last week that Mr. Biden’s new regulations were designed to go still further, some automakers pushed back.

John Bozzella, president of the Alliance for Automotive Innovation, which represents large U.S. and foreign automakers, questioned how the E.P.A. could justify “exceeding the carefully considered and data-driven goal announced by the administration in the executive order.”

“Yes, America’s transition to an electric and low-carbon transportation future is well underway,” Mr. Bozzella said in a statement. “E.V. and battery manufacturing is ramping up across the country because automakers have self-financed billions to expand vehicle electrification. It’s also true that E.P.A.’s proposed emissions plan is aggressive by any measure.”

“Remember this: A lot has to go right for this massive, and unprecedented, change in our automotive market and industrial base to succeed,” Mr. Bozzella said.

At least one American automaker, Tesla, is poised to emerge as a singular winner under the new rules because it produces only electric cars. Other automakers that have lagged in electrification technology have suggested that compliance would be a struggle but none have yet said they would oppose the rules.

Stellantis, formerly Fiat Chrysler — which makes Dodge, Ram and Jeep vehicles — was ranked last year by the E.P.A. as the nation’s worst auto company in terms of fuel efficiency.

In a statement, Eric Mayne, a spokesman for Stellantis, said the company was surprised by the proposed rules, since they are so much more ambitious than Mr. Biden’s previously announced target of 50 percent all-electric new vehicle sales by 2030. But for now, Mr. Mayne said, “We look forward to a constructive dialogue with the agency as the process moves forward.”

Engineers and scientists at an E.P.A. automotive lab have been working over the past year to determine how much electric vehicle technology is likely to advance in the next decade in order to set the strongest, achievable tailpipe emissions limits.

David Haugen, the director of the lab, said that auto companies have always complained about new environmental and emissions standards. “We’ve heard that from them for 50 years, and then the companies have done a great job meeting them each time the standards came in, which gives us confidence that this one is also going to go well,” he said.

Tensions between the auto industry, autoworkers and the Biden administration played out over the past week, with the administration forced to rearrange its rollout of the proposal, according to three people familiar with what happened.

Officials had originally planned for Mr. Regan to announce the policies in Detroit, surrounded by American-made all-electric vehicles.

But as auto executives and the United Auto Workers learned the details of the proposed regulations, some grew uneasy about publicly supporting it, according to the people familiar with their thinking. The setting was moved from Detroit to the E.P.A. headquarters in Washington. No one from the United Auto Workers attended, according to the organization’s spokesman, although Mr. Bozzella and representatives from Ford, General Motors and Mercedes were there.

In an interview, Mr. Regan acknowledged that some auto executives and leaders of the United Auto Workers had expressed anxiety over the proposals, adding that they could be amended to assuage those fears.

“We’re very mindful that this is a proposal, and we want to give as much flexibility possible,” he said. The agency will accept public comments on the proposed rules before they are finalized next year. The rules would take effect starting with model year 2027.

Environmentalists praised Mr. Biden for delivering on a promise he made during his first days in office, when he called climate change a “moral imperative, an economic imperative” that would be central to all his decision-making.

A 2021 report by the International Energy Agency found that nations would have to stop sales of new gasoline-powered cars by 2035 to keep average global temperatures from increasing 1.5 degrees Celsius (2.7 degrees Fahrenheit) above preindustrial levels. Beyond that point, scientists say, the effects of catastrophic heat waves, flooding, drought, crop failures and species extinction would become significantly harder for humanity to handle. The planet has already warmed by an average of about 1.1 degrees Celsius.

Mr. Biden has pledged to cut the country’s emissions in half by 2030 and to stop adding carbon dioxide to the atmosphere by 2050. He took a major step toward meeting that target last summer, when he signed the Inflation Reduction Act. It includes $370 billion in spending over the next decade to fight climate change, including tax incentives up to $7,500 for the purchase of American-made electric vehicles.

That law is projected to help the United States cut its emissions by 40 percent by 2030 — not quite enough to meet Mr. Biden’s pledge. Experts said the new E.P.A. regulations, if enacted as proposed, were needed to reach Mr. Biden’s goal.

“The EPA standards are a huge step forward in addressing the largest source of climate pollution: transportation,” said Luke Tonachel, senior director of the clean vehicles and buildings program at the Natural Resources Defense Council, an environmental advocacy group.

A sharp rise in electric vehicles in the United States could mean wider availability and sales of electric vehicles outside its borders, Mr. Tonachel said. “This can be a world-leading standard that puts the world on a much-needed pathway for curbing global pollution from transportation,” he said.

Laurence Tubiana, who helped broker the 2015 Paris climate accord and who is now chief executive of the European Climate Foundation, welcomed the E.P.A.’s action.

“This is confirmation to the world of the seriousness of the engagement of Joe Biden on climate change and keeps the U.S. as a front-runner on climate,” Ms. Tubiana said. “It’s resonating very well in Europe and the world.”