“Currently, in many car markets, an electric car is more expensive to purchase upfront than a comparable gasoline- or diesel-powered model, which tends to be the biggest consideration for most consumers.” (New York Times, August 18, 2026, below)
The statistic of increasing global sales of electric vehicles (EVs) is often cited as if consumers in an open, free market prefer EVs to internal combustion engines. A careful reading of a recent New York Times article, “The Gulf Oil Shock Is Pushing E.V. Sales to New Heights Globally” (August 18, 2026), supports the counter-thesis that EV sales are driven by special government favor. Here-today-gone-tomorrow EV subsidies (as in the U.S.) raise the question of sustainability. From a government-neutral, consumer-first perspective, EVs are not sustainable.
“Electric car sales are on track to hit record highs this year,” begin Mira Rojanasakul and Brad Plumer, “with 29 percent of all new cars purchased around the world expected to be either purely battery-powered models or plug-in hybrids,” versus four percent in 2020. Continuing:
What makes the surge in electric car sales especially striking is that E.V. purchases have actually declined this year in both China and the United States, the world’s two largest automobile markets. In China, which accounts for roughly half of all E.V. sales worldwide, a weakening economy and reduction in government subsidies led to a drop in overall purchases this year…. China still has roughly as many electric vehicles on the road as the rest of the world combined, a trend that has noticeably curtailed the nation’s oil use.”
China is losing money on its “green” buildout, solar and EVs, the authors could have added. Continuing:
The United States also saw a dip in sales this spring after Republicans in Congress phased out a $7,500 tax credit for electric cars last year. The Biden administration had pushed to expand the credit to help fight climate change, since electric vehicles produce fewer emissions than their gasoline- or diesel-powered counterparts.”
Yes, like the rooftop solar industry, the domestic EV industry has all but crashed with the reduction of special government favor. Expect the same if the ITC and PTC tax credits expire as they are set to do at the end of next year.
The “good news” of EVs is government subsidies and mandates in other countries of the world. The authors state:
More than a dozen governments have also announced new policies to encourage electric vehicle adoption since the conflict began, as countries have sought to curb their imports of expensive oil. Ireland and the Netherlands introduced programs to encourage drivers to trade in their older combustion-engine vehicles for electric models. Chile provided incentives for buses and taxis to go electric. Spain extended electric vehicle tax credits for consumers. China has set new goals to electrify its trucks.
Back to reality:
Currently, in many car markets, an electric car is more expensive to purchase upfront than a comparable gasoline- or diesel-powered model, which tends to be the biggest consideration for most consumers.
California EVs a Government Play
An unsigned editorial in the Wall Street Journal last year, “Newsom Tells a Tesla Truth,” made the same point for California. “Speaking at a Clinton Global Initiative event last week,” the editorial began,
Mr. Newsom boasted that “there is no Elon Musk, there’s no Tesla without California’s regulatory framework, period, full stop. It wouldn’t exist.” …. Newsom is right that California’s EV mandate and subsidies gave Tesla a financial spark. Sacramento dangled thousands of state dollars in subsidies for the affluent to buy Teslas. The state also awarded Tesla a sales-tax exemption worth hundreds of millions of dollars in return for making cars in the state.
More valuable have been the regulatory credits that Tesla has received and sold to other auto makers to comply with the state’s EV mandate. Tesla didn’t turn an annual profit until 2020—17 years after its launch and sales of regulatory credits gave it cash to expand. Last year Tesla made $2.8 billion from credit sales, accounting for more than a third of its profit.
The editorial continued:
California’s EV mandate is effectively an income transfer from auto makers that produce mostly gas-powered cars to Tesla, which accounted for roughly half of the state’s sales last year. If Mr. Newsom is angry that state regulation has padded Tesla’s profits, he could let the $1.4 trillion company sink or swim on its own without mandates or subsidies.
Conclusion
Consumers support electric transport with golf carts and, increasingly, bikes. Electrification in place of oil-firing is also increasingly prevalent with lawn mowers, leaf blowers, and other micro-applications. But not for cars (outside of subsidies), and more so for trucks, ships, trains, and planes.
With government neutral, “deep decarbonization” dies on the vine. The major retreat of U.S. automakers after losses estimated at $50 billion, led by Stellantis (Chrysler, Dodge, Ram, et al.) and Ford, was a monumental mistake. So much for Net Zero on the transportation front.