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Major automakers push congress to block California’s 2035 EV mandate

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Major automakers are urging Congress to intervene and halt California’s aggressive plan to eliminate gasoline-only vehicles by 2035. With the Biden-era EPA waiver empowering California and 11 other states to enforce the rule, automakers warn of immediate impacts on vehicle availability and consumer choice. The U.S. House is preparing for a critical vote to determine if California’s sweeping environmental mandates will stand.

Key Details:

  • Automakers argue California’s rules will raise prices and limit consumer choices, especially amid high tariffs on auto imports.

  • The House is set to vote this week on repealing the EPA waiver that greenlit California’s mandate.

  • California’s regulations would require 35% of 2026 model year vehicles to be zero-emission, a figure manufacturers say is unrealistic.

Diving Deeper:

The Alliance for Automotive Innovation, representing industry giants such as General Motors, Toyota, Volkswagen, and Hyundai, issued a letter Monday warning Congress about the looming consequences of California’s radical environmental regulations. The automakers stressed that unless Congress acts swiftly, vehicle shipments across the country could be disrupted within months, forcing car companies to artificially limit sales of traditional vehicles to meet electric vehicle quotas.

California’s Air Resources Board rules have already spread to 11 other states—including New York, Massachusetts, and Oregon—together representing roughly 40% of the entire U.S. auto market. Despite repeated concerns from manufacturers, California officials have doubled down, insisting that their measures are essential for meeting lofty greenhouse gas reduction targets and combating smog. However, even some states like Maryland have recognized the impracticality of California’s timeline, opting to delay compliance.

A major legal hurdle complicates the path forward. The Government Accountability Office ruled in March that the EPA waiver issued under former President Joe Biden cannot be revoked under the Congressional Review Act, which requires only a simple Senate majority. This creates uncertainty over whether Congress can truly roll back California’s authority without more complex legislative action.

The House is also gearing up to tackle other elements of California’s environmental regime, including blocking the state from imposing stricter pollution standards on commercial trucks and halting its low-nitrogen oxide emissions regulations for heavy-duty vehicles. These moves reflect growing concerns that California’s progressive regulatory overreach is threatening national commerce and consumer choice.

Under California’s current rules, the state demands that 35% of light-duty vehicles for the 2026 model year be zero-emission, scaling up rapidly to 68% by 2030. Industry experts widely agree that these targets are disconnected from reality, given the current slow pace of electric vehicle adoption among the broader American public, particularly in rural and lower-income areas.

California first unveiled its plan in 2020, aiming to make at least 80% of new cars electric and the remainder plug-in hybrids by 2035. Now, under President Donald Trump’s leadership, the U.S. Transportation Department is working to undo the aggressive fuel economy regulations imposed during former President Joe Biden’s term, offering a much-needed course correction for an auto industry burdened by regulatory overreach.

As Congress debates, the larger question remains: Will America allow one state’s left-wing environmental ideology to dictate terms for the entire country’s auto industry?

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Automotive

The high price of green virtue

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Macdonald-Laurier Institute

By Jerome Gessaroli for Inside Policy

Reducing transportation emissions is a worthy goal, but policy must be guided by evidence, not ideology.

In the next few years, the average new vehicle in British Columbia could reach $80,000, not because of inflation, but largely because of provincial and federal climate policy. By forcing zero-emission-vehicle (ZEV) targets faster than the market can afford, both governments risk turning climate ambition into an affordability crisis.

EVs are part of the solution, but mandates that outpace market acceptance risk creating real-world challenges, ranging from cold-weather travel to sparse rural charging to the cost and inconvenience for drivers without home charging. As Victoria and Ottawa review their ZEV policies, the goal is to match ambition with evidence.

Introduced in 2019, BC’s mandate was meant to accelerate electrification and cut emissions from light-duty vehicles. In 2023, however, it became far more stringent, setting the most aggressive ZEV targets in North America. What began as a plan to boost ZEV adoption has now become policy orthodoxy. By 2030, automakers must ensure that 90 per cent of new light-duty vehicles sold in BC are zero-emission, regardless of what consumers want or can afford. The evidence suggests this approach is out of step with market realities.

The province isn’t alone in pursuing EV mandates, but its pace is unmatched. British Columbia, Quebec, and the federal government are the only ones in Canada with such rules. BC’s targets rise much faster than California’s, the jurisdiction that usually sets the bar on green-vehicle policy, though all have the same goal of making every new vehicle zero-emission by 2035.

According to Canadian Black Book, 2025 model EVs are about $17,800 more expensive than gas-powered vehicles. However, ever since Ottawa and BC removed EV purchase incentives, sales have fallen and have not yet recovered. Actual demand in BC sits near 16 per cent of new vehicle sales, well below the 26 per cent mandate for 2026. To close that gap, automakers may have to pay steep penalties or cut back on gas-vehicle sales to meet government goals.

The mandate also allows domestic automakers to meet their targets by purchasing credits from companies, such as Tesla, which hold surplus credits, transferring millions of dollars out of the country simply to comply with provincial rules. But even that workaround is not sustainable. As both federal and provincial mandates tighten, credit supplies will shrink and costs will rise, leaving automakers more likely to limit gas-vehicle sales.

It may be climate policy in intent, but in reality, it acts like a luxury tax on mobility. Higher new-vehicle prices are pushing consumers toward used cars, inflating second-hand prices, and keeping older, higher-emitting vehicles on the road longer. Lower-income and rural households are hit hardest, a perverse outcome for a policy meant to reduce emissions.

Infrastructure is another obstacle. Charging-station expansion and grid upgrades remain far behind what is needed to support mass electrification. Estimates suggest powering BC’s future EV fleet alone could require the electricity output of almost two additional Site C dams by 2040. In rural and northern regions, where distances are long and winters are harsh, drivers are understandably reluctant to switch. Beyond infrastructure, changing market and policy conditions now pose additional risks to Canada’s EV goals.

Major automakers have delayed or cancelled new EV models and battery-plant investments. The United States has scaled back or reversed federal and state EV targets and reoriented subsidies toward domestic manufacturing. These shifts are likely to slow EV model availability and investment across North America, pushing both British Columbia and Ottawa to reconsider how realistic their own targets are in more challenging market conditions.

Meanwhile, many Canadians are feeling the strain of record living costs. Recent polling by Abacus Data and  Ipsos shows that most Canadians view rising living costs as the country’s most pressing challenge, with many saying the situation is worsening. In that climate, pressing ahead with aggressive mandates despite affordability concerns appears driven more by green ideology than by evidence. Consumers are not rejecting EVs. They are rejecting unrealistic timelines and unaffordable expectations.

Reducing transportation emissions is a worthy goal, but policy must be guided by evidence, not ideology. When targets become detached from real-world conditions, ideology replaces judgment. Pushing too hard risks backlash that can undo the very progress we are trying to achieve.

Neither British Columbia nor the federal government needs to abandon its clean-transportation objectives, but both need to adjust them. That means setting targets that match realistic adoption rates, as EVs become more affordable and capable, and allowing more flexible compliance based on emissions reductions rather than vehicle type. In simple terms, the goal should be cutting emissions, not forcing people to buy a specific type of car. These steps would align ambition with reality and ensure that environmental progress strengthens, rather than undermines, public trust.

With both Ottawa and Victoria reviewing their EV mandates, their next moves will show whether Canadian climate policy is driven by evidence or by ideology. Adjusting targets to reflect real-world affordability and adoption rates would signal pragmatism and strengthen public trust in the country’s clean-energy transition.


Jerome Gessaroli is a senior fellow at the Macdonald-Laurier Institute and leads the Sound Economic Policy Project at the BC Institute of British Columbia

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Automotive

Elon Musk Poised To Become World’s First Trillionaire After Shareholder Vote

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From the Daily Caller News Foundation

By Mariane Angela

Tesla shareholders voted Thursday to approve an enormous compensation package that could make Elon Musk the world’s first trillionaire.

At Tesla’s Austin headquarters, investors backed Musk’s 12-step plan that ties his potential trillion-dollar payout to a series of aggressive financial and operational milestones, including raising the company’s valuation from roughly $1.4 trillion to $8.5 trillion and selling one million humanoid robots within a decade. Musk hailed the outcome as a turning point for Tesla’s future.

“What we’re about to embark upon is not merely a new chapter of the future of Tesla but a whole new book,” Musk said, as The New York Times reported.

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The decision cements investor confidence in Musk’s “moonshot” management style and reinforces the belief that Tesla’s success depends heavily on its founder and his leadership.

“Those who claim the plan is ‘too large’ ignore the scale of ambition that has historically defined Tesla’s trajectory,” the Florida State Board of Administration said in a securities filing describing why it voted for Mr. Musk’s pay plan. “A company that went from near bankruptcy to global leadership in E.V.s and clean energy under similar frameworks has earned the right to use incentive models that reward moonshot performance.”

Investors like Ark Invest CEO Cathie Wood defended Tesla’s decision, saying the plan aligns shareholder rewards with company performance.

“I do not understand why investors are voting against Elon’s pay package when they and their clients would benefit enormously if he and his incredible team meet such high goals,” Wood wrote on X.

Norway’s sovereign wealth fund, Norges Bank Investment Management — one of Tesla’s largest shareholders — broke ranks, however, and voted against the pay plan, saying that the package was excessive.

“While we appreciate the significant value created under Mr. Musk’s visionary role, we are concerned about the total size of the award, dilution, and lack of mitigation of key person risk,” the firm said.

The vote comes months after Musk wrapped up his short-lived government role under President Donald Trump. In February, Musk and his Department of Government Efficiency (DOGE) team sparked a firestorm when they announced plans to eliminate the U.S. Agency for International Development, drawing backlash from Democrats and prompting protests targeting Musk and his companies, including Tesla.

Back in May, Musk announced that his “scheduled time” leading DOGE had ended.

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