DETROIT (AP) — President Joe Biden wants to erase Donald Trump’s rollback of automobile pollution and fuel economy standards.
He proposed new rules Thursday and unveiled a nonbinding deal with most automakers to have electric, plug-in hybrid or hydrogen-electric vehicles make up half of their U.S. sales by 2030.
The moves are part of Biden’s plan to fight climate change by persuading people to swap their gas-powered vehicles for those that run on electricity.
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WHAT WILL THE NEW STANDARDS DO?
They basically return pollution and gas mileage requirements close to those adopted when Barack Obama was president. The Obama standards required the fleet of new vehicles to average 5% in carbon dioxide emissions cuts every model year through 2025. Trump rolled that back to 1.5% per year and added another year to the rules. Biden’s plan requires 10% emissions reductions in 2023 and 5% every year after that through 2026. Trump’s standards ended with the fleet averaging about 29 mpg in real-world driving. The Biden rule should be close to the Obama mileage requirement, about 37 mpg. Consumer Reports calculates that the new standards will deliver only 75% of the emissions cuts from the original Obama standards because of delays caused by Trump and loopholes.
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WILL THEY HELP WITH CLIMATE CHANGE?
They should, although environmental groups say they don’t move fast enough to tackle an acute problem that has warmed oceans and spawned more powerful storms, wildfires and floods. They also complain that the standards don’t make up for increased emissions during the Trump years, and bemoan credits that will let automakers offset gas-guzzling vehicles. Some say there should be a plan to phase out gasoline passenger vehicles entirely by 2030. The EPA says over the years its proposal will save about 200 billion gallons of gasoline and cut about 2 billion metric tons of carbon pollution. That’s nearly three times the amount that autos emit in a year. If automakers sell more electric vehicles, that could cut emissions as well, although the precise benefit depends on the fuel used to generate electricity that charges them.
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WILL THE ELECTRIC VEHICLE DEAL BRING MORE CHOICES?
Maybe. The automaker agreements aren’t binding, so there’s no requirement to comply. But well before Biden was elected, automakers already were headed toward a similar sales goal, developing more EVs after seeing the success of global sales leader Tesla. The industry says it can meet the goals only if the government spends big on charging stations and incentives to get people to buy EVs, so Biden will play a big role in getting Congress to approve funding.
Ford, General Motors and Stellantis have promised fully electric pickup trucks, and automakers are starting to roll out electric SUVs in the heart the U.S. market. The consulting firm IHS Markit says there are only about 50 fully electric models on sale now in the U.S., a fraction of the roughly 350 models sold by all automakers. But it expects 130 EV models by 2026. Dave Cooke, senior vehicles analyst with the Union of Concerned Scientists, expects EVs to become available in all states because of the deal. At present, many are sold only on the coasts where there are state zero-emissions-vehicle requirements.
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WILL THIS BE THE END OF THIRSTY MUSCLE CARS OR GIANT SUVS?
Probably not. But since the standards come close to matching the Obama requirements, they could get tougher on big trucks and SUVs. That likely will force automakers to make electric or hybrid versions of their thirstier models, but it probably won’t cancel them. “I think they can do a lot with the same truck platform, and if you want the big SUV, you’ll have to get it in a hybrid or electric,” said Kristin Dziczek, senior vice president and policy analyst at the Center for Automotive Research, an industry think tank. And muscle cars are likely to be even faster when switched to electricity. In nearly all cases, electric vehicles have more instantaneous power than gasoline vehicles.
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WILL AN ELECTRIC VEHICLE COST MORE THAN A GAS CAR OR TRUCK?
Electric vehicles now cost $8,000 to $10,000 more than a combustion-engine vehicle, says the consulting firm Alix Partners. But automakers say the difference is narrowing as they sell more EVs and develop lower-cost batteries. Biden has proposed expanding tax credits and rebates for EV buyers. There’s now a $7,500 federal tax credit, but it’s capped when automakers reach 200,000 in EV sales. (GM and Tesla can no longer offer it). One bill in the Senate promoted by Biden would expand it to all automakers and offer up to $12,500 in tax credits for five years, making EVs more affordable.
TORONTO – Canada’s main stock index was higher in late-morning trading, helped by strength in energy stocks, while U.S. stock markets also moved up.
The S&P/TSX composite index was up 34.91 points at 23,736.98.
In New York, the Dow Jones industrial average was up 178.05 points at 41,800.13. The S&P 500 index was up 28.38 points at 5,661.47, while the Nasdaq composite was up 133.17 points at 17,725.30.
The Canadian dollar traded for 73.56 cents US compared with 73.57 cents US on Monday.
The November crude oil contract was up 68 cents at US$69.70 per barrel and the October natural gas contract was up three cents at US$2.40 per mmBTU.
The December gold contract was down US$7.80 at US$2,601.10 an ounce and the December copper contract was up a penny at US$4.28 a pound.
This report by The Canadian Press was first published Sept. 17, 2024.
OTTAWA – Canada’s inflation rate fell to two per cent last month, finally hitting the Bank of Canada’s target after a tumultuous battle with skyrocketing price growth.
The annual inflation rate fell from 2.5 per cent in July to reach the lowest level since February 2021.
Statistics Canada’s consumer price index report on Tuesday attributed the slowdown in part to lower gasoline prices.
Clothing and footwear prices also decreased on a month-over-month basis, marking the first decline in the month of August since 1971 as retailers offered larger discounts to entice shoppers amid slowing demand.
The Bank of Canada’s preferred core measures of inflation, which strip out volatility in prices, also edged down in August.
The marked slowdown in price growth last month was steeper than the 2.1 per cent annual increase forecasters were expecting ahead of Tuesday’s release and will likely spark speculation of a larger interest rate cut next month from the Bank of Canada.
“Inflation remains unthreatening and the Bank of Canada should now focus on trying to stimulate the economy and halting the upward climb in the unemployment rate,” wrote CIBC senior economist Andrew Grantham.
Benjamin Reitzes, managing director of Canadian rates and macro strategist at BMO, said Tuesday’s figures “tilt the scales” slightly in favour of more aggressive cuts, though he noted the Bank of Canada will have one more inflation reading before its October rate announcement.
“If we get another big downside surprise, calls for a 50 basis-point cut will only grow louder,” wrote Reitzes in a client note.
The central bank began rapidly hiking interest rates in March 2022 in response to runaway inflation, which peaked at a whopping 8.1 per cent that summer.
The central bank increased its key lending rate to five per cent and held it at that level until June 2024, when it delivered its first rate cut in four years.
A combination of recovered global supply chains and high interest rates have helped cool price growth in Canada and around the world.
Bank of Canada governor Tiff Macklem recently signalled that the central bank is ready to increase the size of its interest rate cuts, if inflation or the economy slow by more than expected.
Its key lending rate currently stands at 4.25 per cent.
CIBC is forecasting the central bank will cut its key rate by two percentage points between now and the middle of next year.
The U.S. Federal Reserve is also expected on Wednesday to deliver its first interest rate cut in four years.
This report by The Canadian Press was first published Sept. 17, 2024.
FREDERICTON – New Brunswick‘s finance minister says the province recorded a surplus of $500.8 million for the fiscal year that ended in March.
Ernie Steeves says the amount — more than 10 times higher than the province’s original $40.3-million budget projection for the 2023-24 fiscal year — was largely the result of a strong economy and population growth.
The report of a big surplus comes as the province prepares for an election campaign, which will officially start on Thursday and end with a vote on Oct. 21.
Steeves says growth of the surplus was fed by revenue from the Harmonized Sales Tax and federal money, especially for health-care funding.
Progressive Conservative Premier Blaine Higgs has promised to reduce the HST by two percentage points to 13 per cent if the party is elected to govern next month.
Meanwhile, the province’s net debt, according to the audited consolidated financial statements, has dropped from $12.3 billion in 2022-23 to $11.8 billion in the most recent fiscal year.
Liberal critic René Legacy says having a stronger balance sheet does not eliminate issues in health care, housing and education.
This report by The Canadian Press was first published Sept. 16, 2024.
