Strategies to Decarbonize US Post-Sale Passenger Vehicles

In collaboration with the Toyota Research Institute

group shot of participants at the TRI Workshop

Introduction and Purpose of Workshop

Meeting ambitious net zero GHG emission targets requires rapid adoption of zero emission vehicle technologies. While ZEVs are anticipated to be the primary tool for decarbonizing passenger vehicles, additional strategies to decarbonize the post-sale passenger vehicle fleet may be needed to meet critical GHG reduction targets since ICEVs will remain in the vehicle stock long after 100% ZEV sales are attained.

On November 18th, 2025, ITS Davis held a workshop with the goal of better informing policy making through improved knowledge, increased stakeholder coordination, and development of innovative policy frameworks. The objective of the workshop was to assess the most promising strategies to accelerate the decarbonization of the U.S. on-road passenger vehicle stock, focusing on post-sale vehicles. The scope of strategies that were discussed includes accelerated scrappage, retrofitting vehicles to ZEV powertrains, and fueling ICEVs with low-GHG “drop in” liquid fuels. These strategies can be implemented alongside efforts to rapidly increase ZEV sales under existing policy, technological, and economic conditions. We note that there are many other strategies for decarbonizing transportation (e.g. travel demand reduction, vehicle fuel efficiency, electrification, etc.); these have been well-covered in scientific literature to date and are outside the scope of this project. However, the workshop was an opportunity for participants to raise other novel strategies to decarbonize the post-sale passenger vehicle fleet.

November 18, 2025 Workshop Full Agenda

Research Approach

For each of the three strategies highlighted below, the workshop utilized the information from the background paper including a qualitative description of the strategy and its policy framework; a summary of what is known and what gaps exist in our understanding remain based on a review of selected literature (including peer-reviewed academic literature, technical reports, etc.); and identification of the key policy and research questions. The strategies are reviewed based on four main criteria: environmental impacts on a full lifecycle assessment basis, cost-effectiveness, regulatory compliance requirements, and barriers to market adoption.

There was a robust discussion of each strategy in the morning, followed by parallel breakout sessions for each strategy where priorities were identified for key barriers. The day ended with a panel discussion of a group of government and NGO policy practitioners identifying potential next steps to advance the strategies.

ITS researchers will compile the input from the discussions into detailed notes and recommendations for next steps. The final product of the project will be a workshop paper that compiles information from the background paper, the workshop discussions, the debrief with expert advisors, and provides ITS staff and other researchers with research and policy recommendations.

The Three Strategies

Accelerated Vehicle Turnover

Presented by Katie Jordan, Toyota Research Institute

The slow turnover rate of the U.S. vehicle stock remains a substantial barrier to widespread ZEV deployment. Removing older ICE vehicles from the road in favor of newer, more efficient vehicles is a potential strategy to reduce on-road transportation emissions, particularly if the replacement vehicles are BEVs. One popular way to accelerate fleet turnover is to subsidize older vehicle retirement with a financial incentive for a new vehicle, e-bike, or public transit charge card. Nearly twenty countries have adopted national AVRPs in the past 25 years, but program design varies widely (Woody et al., 2024). Many AVRPs were established in the wake of the Great Recession as a way to stimulate vehicle sales, but more recent programs tend to have a stronger emphasis on emissions reduction, implementing stricter requirements for replacement vehicles or offering more favorable incentives for alternative transportation modes (Antweiler & Gulati, 2015; Li et al., 2013)).

Retrofitting ICEVs to ZEV Powertrains

Presented by Lucas Salgado, Institute of Transportation Studies, UC Davis

In the automotive context, electric retrofitting or repowering involves adapting an existing ICEV into a partially or fully electric car by modifying or replacing its original powertrain¹. The conversion typically requires the installation of a battery pack, control unit, electric motor and other components, often after removing part or the entire original system (Hoeft, 2021; Islam et al., 2022; Rizzo & Tiano, 2020). Most electric automotive conversions are concentrated in commercial medium- and heavy-duty vehicles; the larger chassis offer fewer space or weight constraints for the new components and fleet owners find the lower operational costs of EVs attractive enough to justify the up-front investment (Nyström et al., 2025). Conversions in the passenger light-duty vehicle segment are primarily limited to specialized niches like older classic vehicles for private use (Dupre, 2023).

Retrofits currently face structural barriers, including technical standards, safety regulations, and lack of economies of scale. Initiatives to simplify compliance standards, to incentivize vehicle conversion, and to develop programs to train mechanics in efficient conversion may be beneficial in promoting vehicle conversion as a strategy to reduce on-road emissions. Currently, Asia and Europe account for 64% and 17% of the U.S.D 65.94 billion global automotive retrofitting EV market, respectively, and although the U.S. is not among the leading countries, it is expected to show steady growth in this sector from 2024 and beyond. Medium and heavy-duty categories correspond to 48% of the global market, while two-wheelers and passenger vehicles together account for the remaining 52%.

Low-GHG "Drop in" Liquid Fuels

Presented by Colin Murphy, Institute of Transportation Studies, UC Davis

Lower-carbon alternative liquid fuels that are compatible with existing ICE technology are often called “drop-in” fuels. At present, several forms of drop-in biofuels have emerged into the market at commercial scale; most are used in on-road transport applications, e.g. ethanol, biodiesel, and renewable diesel.⁴At low volumes, ethanol can be considered a “drop-in” fuel that can be used in an unmodified gasoline engine vehicle. Up to 20% may be possible in the vast majority of modern ICEVs (Abel et al., 2021; Mohammed et al., 2021; Tibaquirá et al., 2018). A limited, but non-trivial amount of E85 (gasoline blended with 50-85% ethanol) is sold each year in the U.S. but must be used in a slightly modified vehicle, called a flex fuel vehicle (FFV). Currently, there are about 22 million FFVs on the road in the U.S. (about 8 percent of the fleet), and retrofit kits are available to convert conventional ICEVs to FFVs. Technically, there is also an option to produce a true drop in biofuel that would avoid the need for FFVs, though it would be costlier than producing ethanol and the technology for producing bio-based gasoline substitutes is still immature (Dutta et al., 2023).

The vast majority of biofuels produced today use edible crops as feedstock: corn or sugarcane for ethanol and vegetable oil or non-fossil waste oils for biodiesel and renewable diesel (OECD & FAO, 2025). Advanced biofuels, such as those using algae or cellulosic plant matter as feedstock may offer a pathway to lower GHG emissions (Murphy & Kendall, 2015). However attempts to deploy commercial-scale pilot or demonstration facilities have met with little success to date, due to a combination of technological and financial challenges, policy uncertainty, and supply-chain difficulties. Both conventional and advanced biofuel production volumes are ultimately constrained by limitations on arable land, other agricultural inputs, or potential impacts on food markets.