U.S. States Meld Zero-Emission Car Plans in Sales Goal Push

May 29, 2014 4:07 pm ET

(Updates with auto group’s comments in sixth paragraph.)

May 29 (Bloomberg) -- California, New York and six other states aiming to get more than three million zero-emission vehicles on the road in the next decade, unveiled steps to help achieve that goal including harmonizing consumer incentives and encouraging fleet purchases.

The eight-state coalition, which includes Connecticut, Maryland, Massachusetts, Oregon, Rhode Island and Vermont, said in a report today they plan reciprocity agreements for non- monetary enticements, such as carpool lane access and preferential parking for ZEVs, and will lobby the U.S. to extend tax credits for rechargeable and hydrogen autos. They’ll also encourage installation of workplace chargers and the use of uniform refueling-station signs.

“Creating a strong and robust market for zero-emission vehicles is critically important to the success of clean-energy technologies,” New York Governor Andrew Cuomo said in a statement today. “This action plan will help develop the infrastructure and coordinated policies we need” to reach the goal of 3.3 million ZEVs on highways by 2025, he said.

Measures to coordinate incentives for buyers of ZEVs were a missing component when the states, which account for about a quarter of U.S. auto sales, announced their combined volume target in October. The new enticements also complement California’s mandate to cut automotive carbon emissions and stricter U.S. fuel-economy rules that are already prodding carmakers to offer more efficient models.

The combined volume goal for the eight states is the equivalent of 15 percent of vehicles sales by 2025, the group said in the report.

Billions Invested

“Automakers are committed to the success of ZEV technology and have invested billions of dollars in the development and deployment of these vehicles,” said John Bozzella, president of Global Automakers, the main industry group for Asian and European car manufacturers.

“Consumers are ultimately in the driver’s seat,” Bozzella said. “Preparing the market by addressing challenges and assessing states’ progress is critical to meeting the ultimate goal of increased consumer acceptance of ZEVs.”

A timetable for the new measures and funding plans by the states wasn’t included in the report and there’s not yet an aggregate amount for each state, said Dave Clegern, a California Air Resources Board spokesman, on a conference call.

U.S. sales of plug-in hybrids, including General Motors Co.’s Chevrolet Volt, and battery-only cars, such as Nissan Motor Co.’s Leaf hatchback, have risen 26 percent this year through April to 31,027, according to HybridCars.com’s monthly Dashboard. That’s 0.6 percent of 5.1 million cars and trucks sold in the U.S. in the same period, according to Autodata Corp.

Market Driven

“Once the consumers have the opportunity to evaluate the technology, the market takes over,” Mary Nichols, chair of the California agency, said on today’s call. “We have to take efforts at the early stages because we are looking at a big transformation, there’s no doubt about that.”

Consumer demand for ZEVs, which include plug-in hybrid, battery and hydrogen fuel-cell cars, hasn’t been as robust as some expect, Adam Jonas, an equity analyst for Morgan Stanley, said in a research report yesterday.

A few years ago, forecasts for global electric vehicle penetration were as high as 5 percent or 10 percent by 2020, Jonas said. “From today’s perspective, we think penetration in the 1 percent range would be respectable.”