In the ever-evolving world of the global auto industry, multitasking isn’t just a skill it’s a necessity. With tariffs dominating headlines and industry conversations for months, automakers and dealers have been scrambling to predict the true impact these shifting policies will have on car prices and sales once they go into effect. But behind the noise of trade battles, another significant challenge is quietly gaining momentum and it’s causing just as much anxiety among manufacturers and retailers as any new policy from Washington.
The root of this emerging issue lies in the Advanced Clean Cars II (ACC II) regulations, first introduced by the California Air Resources Board in 2022. These rules mandate a steadily increasing percentage of new vehicles sold in California must be zero-emission primarily electric vehicles (EVs) and, to a smaller extent, plug-in hybrids. The requirement starts at 35 percent for the 2026 model year, jumping by 8 percent each year until a full transition to 100 percent zero-emission sales by 2035. Starting this year, Oregon, Washington, New York, Vermont, and Massachusetts are also set to enforce the same rules.
The major challenge? Current EV sales are nowhere near meeting these targets, particularly in Eastern states. Automakers and dealerships are now facing the possibility of steep penalties $20,000 per noncompliant vehicle and are urgently calling for a pause or reconsideration. Industry leaders are openly speculating about the drastic measures they may have to implement, including major changes to how vehicles are allocated nationwide, just to avoid these penalties.
While the ACC II crisis isn’t in the spotlight every day, it’s fast becoming the next major pain point looming over the auto retail landscape one that may soon overshadow even the most dramatic tariff stories in the news cycle.
