California voters rejected a plan to make electric vehicles more affordable for some residents, dealing a blow to both Lyft and the EV industry.
Proposition 30 would have taxed residents earning more than $2 million a year to subsidize electric cars and public charging stations, as well as fund Forest fire prevention programs. Even with only 41% of the votes collected so far, defeat was clear. As of Wednesday afternoon, some 59% of voters declined the offer.
The main supporter of Prop. 30 was Lyft, which paid more than $48 million to support the future wealth tax. Opponents of the measure — which included Democratic Gov. Gavin Newsom and venture capitalists Michael Moritz and Ron Conway — introduced Prop. 30 as “Lift crime”, calling him “a scheme to further line the pockets of Silicon Valley tech billionaires”.
Yet Proposition 30 does not include exemptions for ride-sharing companies. It would raise tens of billions of dollars to lower the price of electric cars for individuals, including drivers for ride-hailing apps like Lyft and Uber. Both companies have committed to going electric by 2030, and this measure could help them achieve their goals.
Earlier this year, California mandated this almost all shared vehicles to go electric by 2030, as part of a larger effort to gradually push internal combustion engines off the roads. Although the state already works with some programs to help cover electricity costs, Prop. 30 could provide additional assistance. Without it, ride-hailing app companies could be forced to shell out extra cash, one way or another, to incentivize their drivers to switch so they comply with the state’s mandate.
However more accessible options are gradually coming to market, overall electric vehicles are still in short supply and most are too expensive in advance for most people. That’s not good for the climate, since light-duty vehicles like cars and SUVs make up more than half of U.S. transportation-related emissions, according to EPA.
On the Nasdaq, Lyft closed at $10.64, down nearly 2.4% from the previous day. The decline pales in comparison to the meltdown Lyft shareholders suffered on Monday after revealing huge losses in its latest quarterly report. Earlier this month, Lyft laid off 683 employeesor about 13% of the workforce.