Citing a report in Nikkei Asia (paywall), ArsTechnica says Nissan will stop developing internal combustion engines — except for the US market, where the demand for gasoline-powered engines is insatiable, particularly for large SUVs and pickup trucks.
Why is Nissan doing this? Because it has decided making internal combustion engines that comply with the next round of European emissions regulations will just be too expensive. In 2021, the European Union introduced regulations that impose substantial fines on any automaker that fails to get its fleet average below 95g of carbon dioxide per kilometer. As a result, Germany has become the largest plug-in vehicle market in the world after China. Nissan is also not planning on any new internal combustion engines for Japan or China, although it will apparently keep refining existing engines and continue to work on hybrid powertrains.
Government policies also have an impact on the price of electric vehicles. In the UK, EV prices decreased for many models after the government reduced the threshold sales price that allowed EVs to qualify for a subsidy. With no such policy guidelines in the US, the push for more electric cars has been blunted.
The Senate recently refused to alter the EV tax credit to limit the price of qualifying automobiles and trucks, so most manufacturers have little incentive to lower prices. In addition, the US has only a modest goal of reaching 50% EV sales by 2030 — far behind the policies of most other countries. As a result, automakers are prioritizing battery supplies for regions like China and Europe, where the price of non-compliance is simply too high.
Who’s In, Who’s Out
There is a lot of misinformation about which car companies have committed to ending ICE development. Last summer, Volvo said it would not develop its gasoline engines further and stop selling them by 2030, according to CBS. But ArsTechnica says the company has decided to spin off its engine development activities to a new entity, whatever that means. In December it was widely reported that Hyundai Motor Group had also stopped all development of internal combustion engines, something the company subsequently denied.
ArsTechinca says that if the Nikkei Asia report is correct, Nissan is just making explicit the fact that electrification of light passenger vehicles is going to be much more rapid in regions where governments create strong policy incentives. The US has failed to do so, consigning its citizens to many more decades of disease and early death from the crud spewing out of the tailpipes of all those gasoline-sucking engines.
Pretty soon America will be like Australia, a dumping ground for vehicles that don’t meet the emissions standards of more advanced nations. That’s something to be proud of, apparently.