California-led EV mandates ‘impossible’ to meet

DETROIT— ToyotaEngine sounded the alarm Friday that California-led electric vehicle mandates set to begin next year are “impossible” to meet and, if left unchanged, will lead to fewer options for customers in several states.

Current requirements under the California Air Resources Board’s “Advanced Clean Cars II” regulations call for 35% of model year 2026 vehicles, which will begin to be introduced next year, be zero-emission vehicles, or ZEVs. Battery electric vehicles, fuel cell vehicles and, to some extent, plug-in hybrids qualify as zero emissions under the regulations.

“I haven’t seen a forecast from anyone… government or private, anywhere that has told us that number is achievable. At this point, it seems impossible,” Jack Hollis, chief operating officer of Toyota Motor North America, said during a virtual conference. Roundtable with the media on Friday. “The demand does not exist. It is going to limit the customer’s choice of the vehicles they want.”

The California Air Resources Board reports that 12 states and Washington, D.C. have adopted the rules. About half of them did so as of the 2027 model year. The electric vehicle mandates are part of CARB’s Advanced Clean Cars regulations that require 100% of new vehicle sales in the state of California to be electric models. zero emissions by 2035.

JD Power said no states agree to an electric vehicle mandate starting this year. Only California (27%), Colorado (22%) and Washington (20%) have seen at least 20% of retail sales be electric vehicles or PHEVs this year. Other states such as New York (12%), New Mexico (5%) and Rhode Island (9%) are far from complying.

The national average EV/PHEV adoption for retail sales is just 9% through October, JD Power said Friday.

Hollis said if the mandates are not changed, it will lead to “unnatural acts” in the auto industry that have already begun at some automakers, where companies are supplying states that have agreed to the rules with a disproportionate number of electrified models.

“It’s going to distort the industry. It’s going to distort the business. Why? Because it’s not natural what the current demand is in the market,” said Hollis, a veteran auto executive.

Several automotive experts previously told CNBC that the issue of the electric vehicle mandate needed to be addressed regardless of who wins the election this year.

The California Air Resources Board did not immediately respond to a request for comment.

During President-elect Donald Trump’s first term, a legal battle ensued to revoke states’ ability to set their own emissions standards. Several officials expect Trump to renew that push once he returns to the White House.

Hollis said he “hopes it doesn’t come to that” this time, and that states, the federal government and the auto industry can come to a resolution. He also said Toyota would prefer a national standard, a sentiment many automakers previously shared.

“We would always want a 50-state rule, because that way we can treat all customers, all dealers, equitably and fairly, whatever that may be,” Hollis said. “Our hope would be that California and [the Environmental Protection Agency] would match and be reduced to something that is achievable. Even if it is a push, even if it is a reach, but at this point, it is an impossible stage.”