Biden’s EV Bet Not Paying Off for Manufacturers and Investors

When Joe Biden took office, he made it quite clear that EVs and renewable energy would be his legacy.

Well, that has not exactly worked out, with EV sales plummeting and companies like Hertz that bet big on EVs, selling off their inventory.

Outlawing Gasoline Powered Cars

Biden issued a very aggressive order to encourage the transition from gasoline-powered vehicles to EVs with Executive Order 14057.

Biden aims to have 100% zero-emission vehicle acquisitions by 2035 and 100% light-duty acquisitions by 2027.

With Donald Trump coming into office, that is not likely to happen, and I am sure that Trump will reverse whatever orders he can as soon as he takes office on this front.

There is an additional problem for Biden and Democrats on this front… people don’t like the EVs.

Time to Sell

Car rental giant Hertz went all in after Biden made it clear that he wanted to outlaw gasoline-powered vehicles.

Hertz made the move to start transitioning its fleet to electric vehicles, purchasing a significant number of Tesla cars.

Hertz recently announced that it would be selling about 30,000 EVs by the end of the year, and the sales prices are just a small portion of the purchase price. For instance, a Model 3 Tesla was selling for just shy of $18,000 (this car has a base sticker price of about $42,000.

And if you think it is because these cars are beat up, think again. A Model 3 with under 60,000 miles was posted for a mere $24,000. Now, companies like Hertz will often sell off inventory as they roll over their fleet, so selling cars is not the issue here. The issue is how low the price is.

Slumping Sales

EVs are really struggling even though many manufacturers went all in after Biden’s Executive Order was announced. Sales in Germany are tanking, down a reported 22% in November, with Tesla sales being hit particularly hard, down 55%.

The only good news for the industry is that the sales of hybrid cars are actually on the rise, up a reported 20%.

We have read reports of companies like Ford and General Motors pulling back investments with disappointing domestic sales, and based on the fact both companies have agreed to donate $1 million to Trump’s inauguration and donate a fleet of cars, it sounds like they are welcoming a pushback on EVs.

Forcing EVs on the public is clearly not the way to go, especially when you consider how minuscule the buyer’s market is for EVs right now. Simply put, they are just not affordable right now, and until they are, Americans are never going to go for them, especially when performance EVs are so far behind gasoline-powered cars right now.