The rest of the world is following America’s retreat on EVs

Canada, U.K. and E.U. back off electric-vehicle targets as economic reality sets in; even China shows cracks

- Sharon Terlep & Stephen Wilmot

Carmakers argue the EV business model is an unprofitable proposition given still-high battery costs, spotty car-charging networks and dwindling government subsidies.

(REUTERS)

The U.S. retreat from its electric-vehicle ambitions is spreading around the globe.

In Canada, Prime Minister Mark Carney paused an electric-vehicle sales mandate that was set to take effect next year. In the U.K., Prime Minister Keir Starmer has allowed for a more flexible timetable to hit the country’s EV targets. And the European Union last month bowed to pressure from automakers to rethink—a year earlier than planned—its 2035 target for eliminating carbon-dioxide emissions from cars.

“There's this realization that, ‘Hey, this transformation isn’t going as fast as we want,” said Patrick Schauss, a partner at consulting firm McKinsey. “EVs aren’t smartphones.”

The reality is hitting hard in the U.S. General Motors said Tuesday that it would take a $1.6 billion charge because of sinking EV sales, a shift it blamed on recent moves by the U.S. government to end EV subsidies and regulatory mandates. The automaker has lobbied heavily this year to loosen EV requirements.

That might just be the beginning of a financial reckoning from automakers that poured billions into new electric models—from sports cars and sedans to big pickups and sport-utility vehicles—to try to get ready for the government-backed EV mandates.

Automakers have been saying that consumers aren’t adopting EVs as quickly as expected, and government efforts to proliferate the technology are hammering their bottom lines. GM, in announcing its charge, said it is reassessing EV capacity and warned that more losses are possible.