Pub. 16 2017-2018 Issue 3

N E W J E R S E Y C O A L I T I O N O F A U T O M O T I V E R E T A I L E R S I S S U E N O . 4 , 2 0 1 7 8 new jersey auto retailer President’s MESSAGE | BY JAMES B. APPLETON Manufacturers Need To Have More Skin In The Game To Meet Clean Car Mandates Auto manufacturers have it easy right now. The law in New Jersey and eight other so-called Cal-LEV states simply re- quires manufacturers to “deliver” clean vehicles for sale to dealers. There is NO requirement that the vehicles get “sold to consumers” or “placed in service” to meet the requirements of the mandate. This is a monumental oversight that undermines the aggressive push to improve the environment AND imposes a substantial financial burden on New Jersey’s franchised automotive retailers. Zero emission vehicles (ZEVs) accounted for just two tenths of one percent (0.2%) of the New Jersey new vehicle market in 2016. In fact, last year, there were about 1,300 ZEVs sold in New Jersey, breaking the 1,000-vehicle mark for the first time ever. This year, we estimate consumers will buy nearly 2,000 ZEVs. Still, New Jersey’s Clean Car Law requires at least 4.5% of all vehicles delivered by manufacturers for sale in the Garden State in 2018 must be ZEVs. That’s approximately 24,000 ZEVs or 12 TIMES what was sold in 2017. And it gets scarier in the years ahead. NJ CAR projects that existing clean car mandates will require 550,000 ZEVs to be sold in New Jersey between 2018 and the end of 2025. Clearly, dealers would love to sell every single one of those 550,000 ZEVs over the next seven years. But consumers are not buying electric and other alternative-fueled vehicles at anywhere near the numbers mandated by law. And this “delivered for sale” mandate virtually absolves auto manufacturers of any responsi- bility. Automakers can simply dump ZEVs on their dealers’ lots, regardless of consumer demand (or the lack thereof) and never give the EVs a second thought. Because of the way this law is structured, automakers have NO incentive to equip or price ZEVs to sell or offer rebates or incentives to help move them off dealers’ lots and on to New Jersey roads. If ZEVs are sitting on dealers’ lots, they are doing nothing to benefit the environment and every day they sit idle, they are hurting the dealers’ bottom line. That’s why NJ CAR, New Jersey new car dealers and other EV advocates have called for revising New Jersey’s law to require that ZEVs be “sold or leased” or “placed in service” BEFORE manufacturers can earn credit toward their ZEV mandate. This change to New Jersey’s law would encourage auto manufacturers to price the vehicles better or provide rebates and/or incentives to entice consumers to buy EVs in the numbers currently mandated. And government can put its money where its mouth is by providing tax credits and other incentives to help boost the sales of EV and other alternative fuel vehicles. Our elected officials can address other obstacles to greater EV adoption, including the lack of a robust charging infrastructure. Right now, there are only about