Toyota Motor North America has raised concerns that California’s ambitious electric vehicle (EV) mandates may be unachievable and could restrict consumer choice across various states. These mandates, part of California Air Resources Board’s (CARB) “Advanced Clean Cars II” regulations, require that 35% of 2026 model-year vehicles, which will start hitting the market next year, be zero-emission vehicles (ZEVs). CARB’s definition of ZEVs includes battery-electric, fuel cell, and certain plug-in hybrid electric vehicles (PHEVs). However, Jack Hollis, Chief Operating Officer of Toyota Motor North America, doubted these targets, calling them “impossible.”
Lack of Demand and Consumer Readiness
During a virtual media briefing, Hollis underscored the gap between regulatory ambitions and market realities. “Demand isn’t there,” he noted, emphasizing that California’s targets, if unchanged, could reduce options for consumers. The challenge, he stated, is that no projections—public or private—indicate that such a high percentage of EV adoption is feasible within the timeline. This sentiment is echoed by other automakers who question the pace of EV mandates given the slow growth in demand and limited charging infrastructure in many regions.
Current EV Adoption Rates Fall Short
California’s EV mandate aims for all new vehicle sales in the state to be zero-emission by 2035, a goal that 12 other states and Washington, D.C., have adopted, although about half will start from the 2027 model year. Despite this collective movement, J.D. Power reports that no state is currently compliant with the mandates. While California leads with 27% of EV and PHEV sales this year, followed by Colorado and Washington at 22% and 20%, respectively, other states such as New York (12%), New Mexico (5%), and Rhode Island (9%) are significantly behind. Nationally, only 9% of retail vehicle sales are EVs or PHEVs through October.
Market Imbalances and Industry Disruptions
Hollis warned that if California’s targets are not recalibrated, automakers may be forced into what he called “unnatural acts” to meet state quotas. For example, some companies are already directing a higher percentage of EVs to compliant states, distorting the market. “It’s going to distort the industry. It’s going to distort the business. Why? Because it’s unnatural to what the current demand in the marketplace is,” Hollis stated, raising concerns about potential long-term consequences for both consumers and manufacturers.
A National Standard or a Fragmented Approach?
CARB has not yet responded to requests for comment, but the mandate debate is expected to gain traction with the 2024 presidential election on the horizon. Industry experts suggest that if Donald Trump is re-elected, he may attempt to restrict states’ authority to enforce individual emissions standards, as he did during his previous term. Hollis voiced hope for a more collaborative approach, suggesting that the states, federal government, and automotive industry should strive to reach a practical solution.
The Need for a Unified National Strategy
Toyota and other automakers have long favored a national standard over a fragmented approach, as it would enable consistent treatment of customers and dealers. “We would always want a 50-state rule,” Hollis said, advocating for a single, achievable emissions standard. Even if California’s goals were adjusted to remain a “push” or a “reach,” he explained, it would still be more attainable than the current targets, which he characterized as “an impossible stage.”
The California-led EV mandates highlight a growing divide between state and federal climate strategies, presenting challenges for the automotive industry as it navigates customer demand, market readiness, and ambitious emissions goals.
