General Motors (GM) is racing to prepare itself for a president and a world that takes climate change more seriously — and putting the Trump era behind them in the process.
Driving the news: GM yesterday announced an ambitious plan to end global sales of internal combustion vehicles by 2035. It's part of their wider new pledge to be carbon neutral by 2040.
Why it matters: Pulling it off would require an utterly massive transformation of GM's fleet over 15 years.
- Consider that last year, GM sold roughly 2.6 million vehicles in the U.S. — but sales of its Chevy Bolt electric vehicle totaled under 21,000.
- They're planning to offer 30 all-electric models globally by the mid-2020s, but the 2035 target — if accomplished — would still mean a sea-change from even the evolution they see over the next half-decade.
- And it's not a very Trump-y pledge — the former president was dismissive of global warming and sought to slow down vehicle emissions rules that were supportive of electric cars.
The big picture: GM was already greatly expanding its EV efforts during the Trump era, and its share price has been rising over the past year or so in the process.
- But President Biden's election win and pro-EV posture create a less fraught environment for the automaker, which no longer has to tiptoe around Trump and his Twitter feed.
- The Detroit News summed up GM's announcement yesterday by noting it "reflects a newly Democratic-controlled capital pivoting to an aggressive climate agenda."
Flashback: In another stark sign of the new regime, after the election, GM abandoned litigation aimed at thwarting California's effort to impose tougher standards than federal rules. The company had been siding with the Trump administration in the case.
- The company, in a letter to environmental groups, said it was confident that Biden, California and the industry could sing from the same song sheet on national emissions rules.
- "If Trump had won the election, I'd say there is a lesser chance of GM pulling out [of] the lawsuit as it's in the interest of any large automaker to find ways to work with the current presidential administration," Edmunds analyst Jessica Caldwell says.
Yes, but: It's too soon to say how much harmony is in store for GM and the Biden administration. That will become more apparent when Biden's regulators start unveiling specific rules around mileage and emissions standards.
- And one environmentalist who has spent many years tracking industry moves says there's reason to be very skeptical of GM's new posture, given that they initially backed Trump's intent to weaken Obama-era standards.
- "[H]ow can we trust GM and other automakers’ promises when they repudiated their commitment to abide by the standards they negotiated with Obama?" asks Dan Becker of the Center for Biological Diversity.