Nov 10, 2022 - Technology

Electric cars hit a big speed bump in the midterms

Illustration of an EV charger with yellow caution stripes on the cord.

Illustration: Maura Losch/Axios

California voters rejected a measure Tuesday that would have taxed wealthy residents to fund the state's ambitious electric vehicle (EV) transition.

Why it matters: The measure, called Proposition 30, was the midterms' highest-profile vote tied directly to the generational shift toward cleaner cars.

Catch up quick: As my colleague Nathan Bomey reported, earlier this year California moved to ban the sale of new gas-powered cars by 2035.

  • While many in the pro-EV crowd celebrated that decision, it wasn't immediately clear how the state planned to finance it — EVs are expensive, as are chargers and other required infrastructure.
  • Prop 30 was meant to help by levying a new 1.75% tax on the approximately 43,000 Californians making over $2 million.
  • "Most of the money would have gone to programs that help people buy electric cars or install more chargers, with some money dedicated to lower-income people," per Fortune. (Some of the Prop 30 cash would have also gone to wildfire prevention and firefighting.)

The intrigue: California Gov. Gavin Newsom, who has otherwise championed the EV transition and is a driving force behind his state's gas car ban, came out hard against Prop 30.

  • Newsom said the measure would be a giveaway to ride-hailing companies such as Lyft, which under state law are required to largely electrify their fleets by 2030.
  • His argument: Lyft and its ilk should bear the costs of switching to EVs without taxpayer help.

The other side: The results "are an unfortunate setback for the climate movement," Lyft — which spent about $45 million supporting Prop 30 — said in a statement Wednesday.

By the numbers: Prop 30 was among the country's top five ballot measures this Election Day in terms of total contributions, with nearly $73 million spent by parties on either side, per Ballotpedia.

Be smart: California's huge car market gives it outsize influence on automakers. If it says "no more gas cars," the industry will follow.

Meanwhile: On the other side of the country, Massachusetts voters approved a new 4% tax on those making more than $1 million for transportation and education funding, broadly speaking.

  • And New Yorkers OK'd $4.2 billion in bond sales to fund climate change mitigation and resiliency programs. (That Gov. Kathy Hochul held off challenger Lee Zeldin is also good news for public transit advocates across the Empire State.)

The big picture: Even with funds raised by Prop 30, California's all-EVs-by-2035 plan would've been a stretch. Sacramento must now seek other means of financing that goal, perhaps through federal programs.

Go deeper