The working poor need workhorse vehicles

With more than forty percent of the EV’s in the entire country being in California at the end of 2020, the EV popularity in California has gotten President Biden so excited to want the rest of the country to follow California’s lead that Biden issued a new executive order that pushes for half of all new cars sold in America by 2030 to be electric vehicles.

California EV user’s experiences do not bode well for projected EV sales in America as the states’ EV users may be sending a caution to the wind (no pun intended) message to America that the EV usage in the state is slightly more than 5,000 miles a year.

A few reasons why Californians may be sending the wrong message to America are that:

The limited usage of the EV’s is a reflection that the EV is a second vehicle, for those that can afford them, and not the family workhorse vehicle.
The primary owners of EV’s are the highly educated and financially well off.
Their incomes rank among the highest in the country which may be a reflection of home owners that have easier access to charging their EV from their multi-car garages, or for those folks living in new apartments that may have access to more convenient EV charging capabilities.
From that limited elite ownership group, there is a growing percentage of those California EV users that are switching back to gasoline cars, which is sending a message that may further deflate EV growth projections.

The trend for working families is not for the smaller lightweight transportation vehicle, but for the larger and heavier SUVs that are currently half of the new car sales. And for vehicles that are used well in excess of just 5,000 miles per year.

Governor Newsom announced on September 23, 2020 an executive order to ban the sale of gas-powered vehicles by 2035.

The governor cannot make that EV declaration on his own, but he can direct his agencies do to it, which they will under their current clean air act waiver, and other laws they believe grant them this authority. The executive order directs the California Air Resources Board (CARB) to implement rulemaking to ban the sale of the vehicles.
To complicate the Governor’s desire for lifestyle changes for Californians. CARB has no authority over vehicle registration. You will still be able to purchase a used internal combustion engine (ICE) vehicle, or one brought in from out of state and register it in California.
CARB also has no authority to set registration fees to make ICE vehicles more expensive.

The working poor, who often must commute an hour or more inland because coastal housing is so expensive need larger vehicles for their families, do not fall into the current EV elite ownership family. The median income for Latino households in 2016 was $56,200, $55,200 for African American households, and $96,400 for white households. According to several studies, as many as 40 percent of all Californians cannot regularly meet basic monthly expenses.

While many in California are experiencing the rapid growth of “energy poverty” that makes California’s economic recovery from the pandemic even more challenging, the state has 18 million (45 percent of the 40 million Californians) that represent the Hispanic and African American populations of the state

In a state with the highest costs for electricity and fuels, he continues to do everything possible to further INCREASE the costs for electricity and fuels for its 40 million residents. Those huge regressive costs have not boded well for the bottom half making less than $20 an hour.

The report from the Energy Information Agency (EIA) shows that California’s electricity policies have contributed to household users paying 50 percent more, and industrial users paying more than 100 percent more than the national average for electricity. Only Hawaii has higher rates. What is being done to reverse the cost of electricity?

Since drivers of electric vehicles do not purchase gasoline, they do not pay federal gasoline taxes which go into the Highway Trust Fund that pays for federal road maintenance. Again, another burden for the average working family to finance the roads for the elite owners of EVs.

California has almost 400,000 miles of roadways that are heavily dependent on road taxes from fuels that contribute more than $7 billion annually, the same tax base that also funds the environmental programs that will be diminishing in the decades ahead.

The wealthier EV owners may be able to afford the “tax equalizer”, the “VMT” that is coming, but not the working families. The Vehicle Mileage Tax (VMT) has been discussed for years, sounds like a logical idea – requiring the users of the highways to pay the fees to maintain those highways. The VMT tax will be needed to replace the $7 billion annually from fuel sales that will be diminishing in the decades ahead.

President Biden loves California’s policies, regulations, and trends and desires to clone them for the rest of America. Since much of the Presidents voter support comes from working families, he may want to pay close attention to the limited usage of EV’s in the trend setting California, from the small group that can afford them. Working families will still need workhorse vehicles, not a limited lavish second car to show their friends.

Ronald Stein
Ron Stein is an engineer who, drawing upon 25 years of project management and business development experience, launched PTS Advance in 1995. He is an author, engineer, and energy expert who writes frequently on issues of energy and economics.