Auto analyst weighs in on new auto emission standards

The auto industry is being driven toward electric vehicles and plug-in hybrids, but the changes will not happen as quickly as originally planned.

This week, the Biden administration announced emissions standards, that relax tail-pipe limits proposed last year, but eventually will get close to the same strict standards laid out by the EPA.

Auto Industry Analyst Sam Abuelsamid with Guidehouse says when it comes to these new emission standards, the industry might beat the benchmark by 2032.

"I think these new adjusted standards are probably a lot more realistic than what was initially proposed last year," said Abuelsamid. "You know, the original proposal, the Biden administration was targeting getting to roughly somewhere around 56 percent, battery electric vehicles market share in 2030 and then upwards of 60 percent by 2032. That was probably a little bit too aggressive," he said.

Currently, EV sales seem to be slowing down, Abuelsamid said that's due in part to prices for an EV being too high.

"Too many of the EVS that are available in the market are still too high a price point for most people to afford and when you combine that with the high interest rate environment that we have, you know, car loans, often even if you have good credit, you're looking at eight to 10% or more for a car loan, said Abuelsamid. "But towards the end of the decade, we should be in pretty good shape, so you'll have more vehicles that are eligible for tax credits, you also have newer vehicles that are going to be coming in at lower price points than what we have today, reducing the cost of those vehicles, hopefully lower interest rates by that much more much before that timeframe," he said.

Abuelsamid is also hopeful about "much improved" charging infrastructure.

"That's something that's already underway. And but you know, towards the end of the decade, we'll be in much better shape in terms of public charging, so that everyone will be able to charge fairly conveniently and affordably," Abuelsamid said.