General Motors aims to end sale of gasoline, diesel cars, SUVs, light trucks by 2035

General Motors said on Thursday it was setting a goal for selling all its new cars, SUVs, and light pickup trucks with zero tailpipe emissions by 2035, a dramatic transition by the largest U.S. automaker away from gasoline and diesel engines.

The automaker, which also said it plans to become carbon neutral by 2040, made the dramatic announcement just over a week after President Joe Biden took office pledging to tackle greenhouse gas emissions and increase sales of electric vehicles (EVs).

GM sold 2.55 million vehicles in the United States in 2020, but only about 20,000 were EVs, the Chevy Bolt hatchback. It said in November it was spending $27 billion in electric and autonomous vehicles for the next five years, increasing from $20 billion planned before the coronavirus pandemic.

CEO Mary Barra has aggressively pushed GM to embrace electric vehicles and move away from gasoline-powered vehicles.

She said in a statement the automaker had worked with the Environmental Defense Fund (EDF), an environmental advocacy group, for developing a shared vision of an all-electric future and an aspiration to eliminate tailpipe emissions from new light-duty vehicles by 2035.

Morgan Stanley auto analyst Adam Jonas said the decision is “based principally on economic grounds… Would GM decide to wind down a business in under 15 years if it truly felt it would spin off cash and provide positive economic value?”

Jonas added that investors should look for the majority if not all automakers “to follow GM’s precedent”.

In September, California Governor Gavin Newsom said the state plans to prohibit the sale of new gasoline-powered passenger cars and trucks beginning in 2035. Several states, including Massachusetts, say they plan to follow suit.

Newsom referred to GM’s announcement as a “gamechanger” but the California Air Resources Board (CARB) said, “if GM is serious about cleaning up the air our children breathe today, it must also drop its defense of the Trump administration’s rollbacks of federal vehicle emissions standards”.