How California's Gas-Powered Vehicle Restrictions Could Kill Electric Vehicles

California Governor Gavin Newsome recently announced that the state would be banning the sale of new gas-powered vehicles by the year 2035. Environmentalists have cheered, but they really should not.

We've see a massive growth in the Electric Vehicle(EV) market in recent years. Most notably Tesla, but in addition we've seen all other car manufacturers try to compete. The EV's keep getting better and better, but that's only because they have to. They have to compete with cheaper options. They have to compete with cares that have filling stations all around the country. They have to compete with cars that look good.

What happens to the increased innovation in EV's when they no longer have to compete? As we've seen in other markets, a lack of competition stops progress. If you're someone that cares about the future, you can't afford to stop progress. I'm all for a time when we move over to Electric Vehicles, but it needs to be because they are better, not because they are the only option.

We talked about this on the podcast, which you can listen to by following this link.

Audio transcribed from the Podcast:


I remember, one of the big things Henry Ford pushed for was for the government to ban the sale of new horses..


As if you don't see new electric vehicle companies popping up all over the place, which clearly if you're in the stock market that's the case. As if you don't see the sales of electric vehicles going up year over year?

Yeah. So people aren't switching over to them, we must mandate it!


And that's when we get into a little bit of an economic problem, because people are moving over to them voluntarily, at a pretty good rate. I think that's been one of the really good things that Tesla has been able to do. I know, it's why Elon musk went for such a cool car was because basically, electric vehicles were seen as, you know, crappy golf carts, and so people didn't want to switch over to them. So he says "I'm just gonna make a badass car." And I'm gonna make it, I'm gonna make it sexy. Which is why they had the Model S, the model 3, the Model X, and the model Y, which is beautiful. So that's what he was going towards to get people to want to have those vehicles.

When you mandate a market to exist, you lose a lot of the incentive for all the innovation so that it I hope no more states follow along with this. Right now what what electric car makers are having to do is they're having to find cheaper and more affordable ways to produce electric vehicles, while having to make them look amazing. They're having to make them with a ton of horsepower and a ton of battery life.. What happens when you mandate that those are the only cars that you can buy? Does anyone not see an issue here? There's no incentive.

Where's the incentive? Right now, they have incentives to try and make them better. But this person here at the very end, saying electric vehicles will be more affordable in 15 years, and everyone will benefit from the cleaner air. There's no, there's nothing saying they have to be more affordable in 15 years. If you're outlawing the competition.. Why are they going to be less expensive? Out of the goodness of people's hearts? Is that what it's gonna be? They'll have to subsidize them, which is not less expensive, just looks less expensive, but they use your money to subsidize them.

So there's a massive economic problem happening right here, where if you actually care about this technology getting better, you do not want it to be mandated at all.