The Wall Street Journal editorial board pokes fun at traditional auto manufacturers who allow themselves to be “double-crossed” by the Biden administration in regard to new fuel-economy standards.
The board ridiculed manufacturers who believed that the federal government would be a good partner to their business in a Wednesday editorial. They also described how the effort they made to promote Biden’s electric car (EV) agenda would not matter after the Environmental Protection Agency (EPA) announced new regulations without expected subsidies.
“Political theatre can be more entertaining than what’s shown on TV. The board stated that it is hard to not laugh when automakers are double-crossed after they have worked so hard to promote the electric-vehicle agenda.
“The Administration issued new fuel economy standards last week that effectively mandate electric cars will make up 17% of all auto sales by 2026. This is an increase from 3% this year. It was the day Sen. Joe Manchin had rejected President Biden’s Build Back Better plan. This plan includes a multitude of EV subsidies.” it said.
The board observed that the new rules were stricter than those proposed by the EPA over the summer. However, they were seen as possible by the Biden administration due to manufacturers’ commitments to building electric vehicles in the future.
The board noted that BMW, Ford, and Honda expressed support for tighter rules regarding the condition of federal assistance. “Bold action by our partners in the federal government is crucial for building consumer demand for electric cars,” read the statement. The board responded that the feds seemed to have their own ideas about who should run this partnership.
The board stated that Ford, GM, and Stellantis all praised new standards but that they required a “full set” of EV subsidies. The board stated that BMW, Ford, and Honda had formed an alliance in 2020 with California to adhere to tougher fuel standards than those required under the Trump administration. This was in the hope that this would “protect them from an even more burdensome future mandate”.
The board stated that EPA now believes the ‘voluntary deal’ with California demonstrates the feasibility its new standards. EPA cites summer quotes from automakers to support its more difficult new rules. The board pointed out that the new Biden rules were more stringent than California’s, and restricted the regulatory credit auto-makers could roll over and bank to meet the standards.
It was also pointed out that EV manufacturers such as Tesla made money by selling surpluses they had obtained by meeting the standards to traditional producers who struggled with the rules.
It’s understandable that shareholders and auto executives are upset about the double-cross. But this is what happens when businesses get in bed with government “partners”. “The politicians don’t respect your in the morning,” wrote the board.