A former leader at three top U.S. automakers has shared his no-nonsense take on America’s attempt to transition to electric vehicles (EVs).
Bob Lutz, former executive at General Motors, Ford and Chrysler, shared his views on the matter with businessman John Catsimatidis on an episode of the Cats Roundtable podcast: “The government fuel economy rules … are such that they basically cannot be met without broadscale electrification," Lutz said. "What we’re seeing is electrification that could occur naturally, because there’s a lot to be said for electric vehicles, but right now, it’s being forced by governments for environmental reasons.”
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Lutz believes there’s not enough electricity-generating infrastructure in the U.S. to support President Joe Biden’s goal of having 50% of all new vehicle sales be electric by 2030. He also believes there’s simply not enough demand.
“The regulation is way ahead of the public,” he added. “The American public is not ready for the broad adoption of electric vehicles. There are maybe 10%-12% of people who really want an electric vehicle — and that’s good — but the remainder still want internal combustion.”
And now, a reported group of 3,700 American auto dealers have signed a letter to the president declaring it's "time to tap the breaks on the unrealistic government electric vehicle mandate." The dealers, calling themselves the EV Voice of the Customer, argue cars are piling up in their lots thanks to the high cost of EVs, lack of garages equipped for home charging, the time these cars take to charge — and their fluctuating driving range in extreme temperatures.
Here’s what’s going on in the EV market and why auto expert Lutz is so skeptical about the federal government’s grand EV plans.
Biden's push for EVs
Since coming into the Oval Office, Biden has championed robust “Made in America” policies, specifically with regard to domestic manufacturing of EVs, EV chargers and batteries.
And now, the government says the number of EV sales has tripled while the number of available EV models has doubled since he took office. There are also over 130,000 public chargers across the country — a 40% increase over 2020 — and the private sector has committed more than $120 billion in domestic EV and battery investments since the Inflation Reduction Act was passed into law.
In April 2023, the Environmental Protection Agency (EPA) proposed sweeping emissions cuts — deemed the “most ambitious pollution standards ever for cars and trucks” by EPA administrator Michael S. Regan — designed to avoid nearly 10 billion tons of CO2 emissions (equivalent to more than twice the total U.S. CO2 emissions in 2022) by 2055.
The EPA projected this plan would accelerate the transition to electric vehicles to the extent that they could account for 67% of new light-duty vehicle sales and 46% of new medium-duty vehicle sales in model year 2032.
But Lutz remains skeptical about the proposed speed of this widespread transition to EVs.
“This transition by 2030 is just not going to happen,” he said. “Everybody will continue to make a lot of internal combustion vehicles — which sell. And they’ll make electric vehicles, which even now are not selling at the pace everybody would like.”
He thinks that governments in Europe and the U.S. will have to repeatedly push out their EV transition deadlines to allow the automobile industry, the energy industry and the driving public to catch up.
“If it’s an authoritarian government like China, they’ll just say: ‘You either buy an electric vehicle or you buy no vehicle at all.’ Well, that may work in China but it’s not going to work in the United States. Or Europe,” he added.
The dealers themselves have bristled against the government's involvement. Mickey Anderson, president and chief executive officer of Baxter Auto Group, which owns and operates dealerships in Nebraska, Kansas, and Colorado, told Bloomberg he doesn't think the government should be forcing these mandates on them. “Dealers will sell whatever is manufactured,” he said. “But we’ve never seen a situation where government has intervened in such a draconian way.”
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Consider getting an EV
While Lutz is unconvinced by some of the political rhetoric around EVs, that doesn't mean he’s not a fan of clean transportation. In fact, he encourages Americans to keep an open mind about them.
“If you’re interested in excellent transportation, silence, refinement, high performance, etc., you should definitely consider an electric vehicle,” he said. “There is absolutely no reason not to buy one unless you’re a person who makes frequent trips over 300 or over 400 miles, in which case you should not.”
There are many benefits to ditching your gas guzzler for an EV. Despite their higher purchase prices, EVs can be more cost-efficient than internal combustion vehicles in the long run. It generally costs less per mile to charge an EV than to fill up a gas-powered car. You would likely also see lower recurring maintenance costs because you don’t have to pay for things like oil changes or replacing parts like timing belts and water pumps.
Another bonus is that you could also get money back from Uncle Sam in the form of EV tax credits. Introduced in the Inflation Reduction Act in 2023, motorists are able to claim up to $7,500 in credits for purchasing an EV that meets certain conditions.
But there’s still a lot of development that needs to take place. As Lutz pointed out, some EVs have limited battery capacity and range, making them unsuitable for people who regularly drive long distances. Repairs and auto insurance costs for EVs also remain punitively high at the moment due to electric cars’ higher price tags and more complex equipment.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.