Bloodbath In the Auto Industry

This story in the Telegraph relates to the UK, but the same thing is going on wherever governments push “green” mandates on buyers and sellers of motor vehicles:

Car makers are rationing sales of petrol and hybrid vehicles in Britain to avoid hefty net zero fines, according to one of the country’s biggest dealership chains.

Robert Forrester, chief executive of Vertu Motors, said manufacturers were delaying deliveries of cars until next year amid fears they will otherwise breach quotas set for them by the Government.

This means someone ordering a car today at some dealerships will not receive it until February, he said.

At the same time, Mr Forrester warned manufacturers and dealers were grappling with a glut of more expensive electric vehicles (EVs) that are “not easily finding homes”.

Consumers don’t want to buy EVs because they are expensive and inconvenient, if not at times impossible, to charge. But government quotas try to force us to buy EVs against our will:

He said: “In some franchises there’s a restriction on supply of petrol cars and hybrid cars, which is actually where the demand is.

“It’s almost as if we can’t supply the cars that people want, but we’ve got plenty of the cars that maybe they don’t want.”
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The chief executive blamed the zero emission vehicle (ZEV) mandate, which requires at least 22pc of cars sold by manufacturers to be electric from this year.

The situation will only get worse, as the number of required EVs is slated to continue rising until all cars are electric. In the meantime, auto companies and dealers are losing enormous amounts of money. A number of manufacturers have scaled back plans to convert their fleets to EVs in the face of stagnant sales.

Mr Forrester added that although some people might cheer falling electric car prices, supporters of the ZEV mandate in its current form were “economic buffoons, because car manufacturers are being forced to discount EVs to such an extent that they’re making losses…and that is not a good thing for business”.
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“As Carlos Tavares [chief executive of Stellantis] has said, why should they sell cars at a loss because of UK government policy?

“The new car market is no longer a market, unfortunately. It’s a state-imposed supply chain.”

It is hard to see where all of this ends. If governments want to force manufacturers to make EVs, and manufacturers are losing enormous amounts of money on EVs, one solution might be to nationalize the auto manufacturers. Liberals would be fine with that, although there is no telling who, exactly, could nationalize any of today’s global auto companies.

Of course, if governments mandate that all new vehicles must be electric, manufacturers will be able to sell at a profit. But as the percentage of new car sales required to be electric continues to rise, consumers will feel their choices to be constrained in a way that they haven’t thus far. Most people prefer the superior internal combustion technology. How will they react when politicians make it illegal to buy the cars they want?

One hopes that consumers will rebel at the polls, just as they should rebel against rising electricity rates, gasoline prices, and the other evil consequences of liberal economic policies. But so far, voters have been mostly quiescent, as they are–to use a now-discredited metaphor–being boiled slowly.